Return on Assets Equals

question 3

Multiple Choice

Return on assets equals:

• A) current assets divided by total assets
• B) return on investment divided by return on net worth
• C) net profit margin times asset turnover
• D) total assets divided by costs of goods sold

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Definitions:

Transfer Price

The price at which goods and services are transferred between departments or related entities within the same organization.

Variable Costs

Costs that vary directly with the level of production or business activity, such as materials and labor costs.

Allocated Fixed Costs

Fixed costs that are distributed across different departments or projects based on determined criteria.

Income From Operations

Earnings generated from the normal business activities of a company, excluding income from other sources like investments.