A Characteristic Common to Governmental and Not-For-Profit Organizations Is Operating

question 24

True/False

A characteristic common to governmental and not-for-profit organizations is operating purposes that are other than to provide goods or services at a profit or profit equivalent.

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Definitions:

Return On Investment

A measure of the profitability and efficiency of an investment, calculated as net profit divided by the cost of the investment.

Invested Assets

Assets that have been purchased or acquired for the purpose of generating income or profit, not for immediate resale.

Minimum Return

The lowest acceptable rate of return on an investment that a manager or investor is willing to accept.

Residual Income

Residual income is the amount of net income generated in excess of the minimum rate of return. It's often used to assess the performance of business units.