Return on Investment (ROI) Is the Most Widely Used Measure

question 12

Multiple Choice

Return on investment (ROI) is the most widely used measure of performance in what responsibility center?

• A) revenue center
• B) expense center
• C) investment center
• D) profit center
• E) standard cost center

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Definitions:

Cash Conversion Cycle

A metric that measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.

Production and Sales Process

The combined sequence of operations involved in manufacturing goods and selling them to customers.

Days Sales Outstanding (DSO)

A measure of the number of days that it takes to collect on accounts receivable.

Accounts Receivable

Money owed to the company for goods or services provided and billed to a customer.