The Return on Assets Is Calculated by ________

question 143

Multiple Choice

The return on assets is calculated by ________.

• A) subtracting net income from average total assets
• B) adding net income and average total assets
• C) dividing net income by average total assets
• D) multiplying net income and average total assets

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Definitions:

Current GAAP

The most up-to-date set of Generally Accepted Accounting Principles that companies are required to follow when preparing financial statements.

Direct Method

A cash flow statement preparation approach that lists major categories of gross cash receipts and payments.

Operating Activities

refer to the primary revenue-generating activities of a business, including production, sales, and provision of services, reflected in its cash flow.

Financing Activities

This refers to transactions and events where cash flows into or out of a company to finance its operations and expansions, such as issuing equity or raising debt.