All Else the Same, Which of the Following Ratios Would

question 121

Multiple Choice

All else the same, which of the following ratios would be unaffected by any change of the depreciation method?

• A) Price-sales ratio.
• B) Price-earnings ratio.
• C) Return on assets.
• D) Return on equity.
• E) Price-cash flow ratio.

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Definitions:

Positive Assurance

Certification or guarantee often required in auditing, indicating that financial statements and records accurately reflect the entity's financial status.

Repudiation

The refusal to accept or be associated with, often involving a contract or agreement.

Frustration of Purpose

A legal defense allowing for the termination of a contract when an unexpected event undermines the contract's core purpose.

General Contract Law

The body of law that governs the formation, execution, and enforcement of agreements between parties.