The Following Selected Information Is from Acme's Annual Report for the Years

question 222

Multiple Choice

The following selected information is from Acme's annual report for the years ended December 31:

-Refer to the Acme annual report above.Which of the following statements is TRUE about the return on assets for 2011 and 2012?

• A)Return on assets increased in 2012 because the company made a large investment in additional property,plant & equipment in 2012.
• B)Return on assets increased in 2012 because net income is 50% higher in 2012 than in 2011,while property,plant and equipment increased 87.5%.
• C)Return on assets decreased in 2012 because the large investment in additional property,plant & equipment did not generate enough additional operating income.
• D)Return on assets decreased in 2012 because net income for 2012 is much larger than in 2011.

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Definitions:

Marginal Product

The additional output produced by using one more unit of a variable input, holding other inputs constant.

Labor Input

The amount of work or effort provided by employees or workers that is used in the production of goods and services.

Total Product

The total output or production achieved by a firm or economy at a given level of input.

Marginal Product

The additional output produced by adding one more unit of a specific input, keeping all other inputs constant.