Consider the Following Balance Sheet, for Games Inc

question 6

True/False

Consider the following balance sheet, for Games Inc. Because Games has $800,000 of retained earnings, we know that the company would be able to pay cash to buy an asset with a cost of $200,000.

---

Definitions:

Return on Investment (ROI)

A measure used to evaluate the efficiency or profitability of an investment, calculated by dividing the profit of an investment by its cost.

Investment Center A

A segment or area of a business responsible for its own revenue, expenses, and assets, with its performance measured by its ability to generate income relative to its invested capital.

Income Data

Financial information that shows the revenues earned and expenses incurred by a business over a period of time.

Asset Data

Information about the resources owned by a business, which have economic value and can contribute to generating income.