Cable Company Had the Following Results for the Year Just $\begin{array}{lccc}\text { Operating Income } & \$ 2.500 \\\text { Turnover } & 4 \\\text { Return on Investment } & 20 \%\end{array}$

question 129

Multiple Choice

Cable Company had the following results for the year just ended:
$\begin{array}{lccc}\text { Operating Income } & \$ 2.500 \\\text { Turnover } & 4 \\\text { Return on Investment } & 20 \%\end{array}$

What were Cable Company's average operating assets during the year?

• A) $10,000.
• B) $12,500.
• C) $50,000.
• D) $200,000.

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Definitions:

Insurance

A contractual arrangement in which a company (insurer) provides compensation or coverage against losses or damages in return for payment of a premium.

Adjusting Entry

A journal entry made in accounting records at the end of an accounting period to allocate income and expenditures to the appropriate period.

Prepaid Expenses

Prepaid expenses are costs for goods or services that are paid in advance of the receipt or use, recognized as assets on a balance sheet.

Depreciation Expense

The systematic allocation of the cost of a tangible asset over its useful life, representing the wear and tear, or expiry of the asset's practical lifespan.