The Proper Numerator to Use in Computing Return on Assets

question 11

Multiple Choice

The proper numerator to use in computing return on assets is

• A) Net income after noncontrolling interests - interest expense + noncontrolling interest in income
• B) Net income after noncontrolling interests + (1- tax rate) × interest expense + noncontrolling interest in income
• C) Net income after noncontrolling interests + (tax rate) × interest expense + noncontrolling interest in income
• D) Net income after noncontrolling interests - (1- tax rate) × interest expense + noncontrolling interest in income

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Definitions:

Rules of the Game

The established guidelines, criteria, or regulations that dictate how a particular activity or process is conducted.

Disagreement Value

The worst outcome that a party is willing to accept before walking away from negotiations or a transaction.

Car Dealer

A business entity that sells new or used cars at the retail level, based on a dealership contract with an automaker or its sales subsidiary.

Sale Price

The final price at which a product or service is sold after any deductions or promotions.