Why Do Retailers Pursue Different Strategies When Determining Whether Their

question 74

Multiple Choice

Why do retailers pursue different strategies when determining whether their return on investment is profitable?

• A) Profitability can be defined differently depending upon the retailer
• B) Strategies may change depending upon performance
• C) Different retailers have different financial operating characteristics
• D) Retailers can use the profit path and the turnover path interchangeably
• E) Retailers use the turnover strategy only when their investments "turn over" to profit

---

Definitions:

Normal Balance

The usual debit or credit balance that an account type is expected to have, which helps in ensuring the correct recording of transactions.

Debit

An accounting entry that results in either an increase in assets or a decrease in liabilities on a company's balance sheet.

Dividends Declared

Profits distributed by a company to its shareholders, usually determined by the board of directors, and not yet paid out.

Normal Balance

The side (debit or credit) of an account that is typically increased; for assets and expenses, it's a debit; for liabilities, equity, and revenue, it's a credit.