Which of the Following Is Calculated by Dividing (Net Income

question 116

Multiple Choice

Which of the following is calculated by dividing (net income less preferred dividends) by average common stockholders' equity?

• A)Return on assets ratio
• B)Return on equity ratio
• C)Earnings per share
• D)Net profit margin ratio

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Definitions:

Tangible Assets

Physical assets that have a concrete form, such as buildings, machinery, vehicles, and inventory.

Prospective Buyer

A potential customer who has demonstrated interest in purchasing a product or service, but has not yet completed the transaction.

Tangible Assets

Physical items of value owned by a company, such as machinery, buildings, or land.

Intangible Assets

Non-physical assets of a business such as intellectual property, brand value, and goodwill that have value but are not physical objects.