Examlex
Which of the following is very important for counseling clients?
Residual Income
Residual income is the profit earned after subtracting all required costs of capital from the operating profit.
Minimum Required Rate
The least acceptable rate of return on an investment, often used in capital budgeting to assess potential projects.
Operating Assets
Assets used by a business in its daily operations to generate revenue, excluding investments and non-essential properties.
Contribution Margin Ratio
A financial metric that shows the portion of sales revenue that exceeds variable costs, indicating how sales affect profitability.
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