Return on Assets Is Most Closely Related to

question 172

Multiple Choice

Return on assets is most closely related to

• A)profit margin and debt to assets ratio.
• B)profit margin and asset turnover.
• C)times interest earned and debt to stockholders' equity.
• D)profit margin and free cash flow.

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Definitions:

Salaries Payable

The amount owed to employees for work performed that has not yet been paid at the end of a reporting period.

Salaries Expense

The total amount of salary payments made to employees, recognized as an expense on the income statement.

Direct Method

A cash flow statement reporting approach where actual cash flow information from the company's operating activities is provided, distinguishing between cash receipts and payments.