A Firm Has Total Assets of $800,000 and Total Liabilities

question 14

Multiple Choice

A firm has total assets of $800,000 and total liabilities of $300,000.There are no preference shareholders.Earnings before interest and taxes are $100,000.Interest is $21,000 and taxes are $34,000.The return on ordinary shareholders' funds is:

• A) 8.0%.
• B) 12.5%.
• C) 9.0%.
• D) 3.8%.

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Definitions:

HRM Practices

The activities and strategies that human resource management professionals employ to manage and develop an organization's workforce.

Low-Cost Provider Strategy

A competitive strategy focusing on producing goods or services at the lowest cost compared to competitors to attract price-sensitive customers.

Differentiation Strategy

A business approach in which a company seeks to distinguish its products or services from competitors through unique features.

Strategic Planning

The process of defining a company's strategy or direction and making decisions on allocating resources to pursue this strategy, including its capital and people.