The Three Basic Ratios Used in the DuPont System of Analysis

question 62

Multiple Choice

The three basic ratios used in the DuPont system of analysis are ________.

• A) net profit margin, total asset turnover, and return on investment
• B) net profit margin, total asset turnover, and return on equity
• C) net profit margin, total asset turnover, and equity multiplier
• D) net profit margin, financial leverage multiplier, and return on equity

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Definitions:

Bank Reconciliation

A process that explains the difference between the bank balance shown in an organization's bank statement, as provided by the bank, and the corresponding amount shown in the organization's own accounting records at a particular point in time.

Bank Reconciliation

The process of comparing and aligning a company’s financial records with those shown in its bank statement to ensure accuracy and completeness.

Bank Service Charges

Fees charged by banks for accounts and various banking services, such as monthly maintenance or transaction fees.

NSF Checks

Checks that cannot be processed due to insufficient funds in the account on which they are drawn.