Return on Total Assets Is Generally Considered to Be a Better

question 16

True/False

Return on total assets is generally considered to be a better measure of the overall profit performance of a business than is profit margin on sales.

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Definitions:

Financial Statement

Reports that provide information about a company's financial performance and position, including balance sheets, income statements, and cash flow statements.

Normal Balance

The side (debit or credit) of an account that is expected to have a higher balance, based on the account type.

Temporary/Permanent

Categories used to distinguish between accounts that are closed at the end of an accounting period (temporary) and those that carry forward their balance into future periods (permanent).

Accrued Interest

Interest on loans or bonds that has accumulated but not yet been paid.