Because of Its Relationship to Dividends and Market Price, Which

question 12

Multiple Choice

Because of its relationship to dividends and market price, which ratio is important to investors?

• A) current ratio
• B) debt-to-equity ratio
• C) price/earnings ratio
• D) asset turnover ratio

Solve complex problems involving multiple steps and calculations to find exact numerical answers.

Understand the rights and responsibilities of corporate directors and officers.

Comprehend the characteristics and implications of stock certificates and shareholder ownership.

Recognize the mechanisms and procedures for corporate dissolution and liquidation.

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Definitions:

Return on Assets

A profitability ratio that measures how efficiently a company is using its assets to generate earnings.

Direct Method

In cash flow reporting, a method that shows the specific sources and uses of cash, categorizing cash flows into operating, investing, and financing activities.

Net Cash Provided

The amount of cash generated by a company’s operations after accounting for all cash inflows and outflows.

Operating Activities

Activities that relate directly to the production, sale, and delivery of a company's products or services, affecting the net income.