Which of the Following Firms Would Be Expected to Have

question 30

Multiple Choice

Which of the following firms would be expected to have a high ROE based on that firm's high profitability?

• A)a medical supply company that provides very precise instruments at a high price to large medical establishments such as hospitals
• B)a low-end retailer that has a low mark-up on all items it sells
• C)a brokerage firm that has high levels of leverage
• D)a grocery store chain that has very high turnover,selling many multiples of their assets per year

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Definitions:

Bank Statement Balance

The ending balance on a bank statement for a particular period, reflecting all transactions including deposits, withdrawals, fees, and interest earned.

Cash Account Balance

Cash account balance represents the amount of cash or cash equivalents a company or individual holds in their account at any given time.

Outstanding Checks

Checks that have been written and recorded in a company's books, but not yet cleared or deducted from the bank account balance.

Deposits In Transit

Funds that have been received and recorded by a business but not yet credited by its bank, affecting the reconciliation of bank statements.