In Computing the Margin in a ROI Analysis,which of the Following

question 20

Multiple Choice

In computing the margin in a ROI analysis,which of the following is used?

• A) Sales in the denominator.
• B) Operating income in the denominator.
• C) Average operating assets in the denominator.
• D) Residual income in the denominator.

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Definitions:

Incurred Expenses

Costs that have been recognized or consumed in the operations of a business, regardless of the payment status.

Net Income

The total profit or loss of a company after deducting all expenses, taxes, and costs from total revenue.

Accounting Period

The span of time at the end of which the financial position of a business is calculated and reported, typically a month, quarter, or year.

Unexpired Insurance

The portion of an insurance premium that has not yet expired during the policy period.