Which of the Following Statements About Profitability Measures Is NOT

question 35

Multiple Choice

Which of the following statements about profitability measures is NOT generally true?

• A)Other things equal,the firm and other investors prefer higher profitability ratios.
• B)Profitability measures use values from the firm's income statement.
• C)Profitability measures use values from the firm's balance sheet.
• D)All of the above are true.

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Definitions:

Departmental Sales

Revenue generated from the sales activities of specific departments within a retail or corporate setting, tracked to evaluate the performance of each department.

Retail Store

A business establishment that sells goods or services directly to consumers, primarily for personal or household consumption.

Depreciation

The systematic allocation of the cost of a tangible asset over its estimated useful life, recognizing the decrease in value over time.

Allocation Bases

Criteria or metrics used to distribute overhead costs to different departments or products in a company, ensuring accurate cost accounting.