A Corporation Has a Total Asset Turnover of 2 Times

question 7

Multiple Choice

A corporation has a total asset turnover of 2 times, ROA of 12 percent and EM of 1.17. What is this firm's profit margin and debt ratio?

• A) profit margin: 2 percent; debt ratio: 19.45 percent
• B) profit margin: 3 percent; debt ratio: 31.81 percent
• C) profit margin: 4 percent; debt ratio: 12.94 percent
• D) profit margin: 6 percent; debt ratio: 14.53 percent

Identify the legal framework for incorporating and the role of articles of incorporation.

Explain the legal responsibilities and duties of directors towards the corporation and its stakeholders.

Understand the significance of shareholder agreements in defining rights and responsibilities within closely held corporations.

Discuss the legislative and regulatory environment governing corporate operations and securities in Canada.

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Definitions:

Fixed Costs

Business costs that do not vary with the amount of goods produced or the volume of sales.

Material Cost

The expense incurred to acquire raw materials needed to produce a product or complete a project.

Break-Even

The instance where cumulative spending equals cumulative earnings, causing neither a financial gain nor a deficit.

Variable Costs

Costs that vary directly with the level of production or output.