Indicate Which of the Following Analytical Tools Should Be Used

question 73

Short Answer

Indicate which of the following analytical tools should be used in each situation.Each ratio is used only once.
a.price/earnings ratio
b.dividend yield ratio
c.return on assets ratio
d.return on equity ratio
e.gross profit ratio

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Definitions:

Fair Value

The expected selling price for an asset or the amount needed to cover a liability, facilitated through a systematic deal between market participants on the specific date of measurement.

Qualitative Description

An explanation or characterization of something that focuses on its qualities and characteristics, rather than quantifiable measures.

Contingent Consideration

Usually, an obligation of the acquirer to transfer additional assets or equity interests to the former owners of an acquiree as part of the exchange for control of the acquiree if specified future events occur or conditions are met. However, contingent consideration also may give the acquirer the right to the return of previously transferred consideration if specified conditions are met.