Carter Company Reported the Following Financial Numbers for One of Its

question 80

Multiple Choice

Carter Company reported the following financial numbers for one of its divisions for the year;average total assets of $4,100,000;sales of $4,525,000;cost of goods sold of $2,550,000;and operating expenses of $1,372,000.Compute the division's return on investment:

• A)30.3%.
• B)23.6%.
• C)13.3%.
• D)10.4%.
• E)14.7%.

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Definitions:

Income Taxes

Taxes imposed by the government on the income generated by individuals or entities.

Capital Markets

Financial markets where debt or equity-backed securities are traded, facilitating the raising of capital by companies and governments.

EBIT-EPS Analysis

A study conducted to determine the impact of debt on a company's earnings before interest and taxes (EBIT) and its earnings per share (EPS).

Leverage

The employ of various financial instruments or borrowed capital, like debt, to increase the potential return of an investment.