The Three Parts of the Du Pont Identity Can Be

question 95

Multiple Choice

The three parts of the Du Pont identity can be generally described as:
I.operating efficiency,asset use efficiency and firm profitability.
II.financial leverage,operating efficiency and asset use efficiency.
III.the debt-equity ratio,the capital intensity ratio and the profit margin.
IV.the equity multiplier,the profit margin and the total asset turnover.

• A)I and II only
• B)II and III only
• C)I and IV only
• D)II and IV only
• E)III and IV only

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Definitions:

Inventory Valuation

The method of calculating the cost associated with the inventory held by a business, influencing financial statements and taxation.

Net Realizable Value

The estimated selling price of goods, minus the estimated costs of completion and costs necessary to make the sale.

Interim Financial Report

A set of financial statements covering a period shorter than a full fiscal year, usually quarterly or semi-annually, to provide investors and other stakeholders with up-to-date information.

Inventory

The raw materials, work-in-process goods, and completely finished goods that are considered to be the portion of a business's assets that are ready or will be ready for sale.