If Management Wishes to Measure How Effectively the Assets Were

question 78

Multiple Choice

If management wishes to measure how effectively the assets were used in generating a profit, they could use the:

• A) rate of return on total assets.
• B) rate of return on common stockholders' equity.
• C) return on sales.
• D) times interest earned.

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Definitions:

Stock Warrants

Financial instruments that give the holder the right to purchase a company's stock at a specified price before the warrant expires.

Exercise Date

The specific date on which an option contract can be executed or acted upon by the holder.

Fixed Compensatory

Relates to a form of compensation or damages that are predetermined and not subject to change.