Isaiah Company Has Net Income Before Interest and Taxes of $720,000;

question 57

Multiple Choice

Isaiah Company has net income before interest and taxes of $720,000; beginning total assets of $2,100,000; and ending total assets of $2,300,000.Isaiah's return on total assets is:

• A)32.7%.
• B)11.2%.
• C)3.1%.
• D)31.3%.

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Definitions:

Straight-Line Depreciation

A strategy for apportioning the cost of a concrete asset into equal yearly sums throughout its serviceable life.

Net Income

The total profit of a company after all expenses, including taxes and operating costs, have been deducted from total revenue.

Present Value Factor

A factor used in the calculation of the present value of cash flows, based on a specific rate and number of periods.

Net Present Value

A financial metric that calculates the difference between the present value of cash inflows and outflows over a period of time.