The Following Question Relate to PQR, Which Has the Following

question 25

Multiple Choice

The following question relate to PQR, which has the following ratios: return on assets, (ROA) 12%; return on equity (ROE) 14%; and current ratio (CR) of 2:1.
-The company changed accounting methods by deciding to capitalise rather than expense a research and development outlay.This will:

• A) increase ROE,but have no effect on ROA and CR
• B) increase ROA,ROE and CR
• C) increase ROA and ROE,but have no effect on CR
• D) have no effect on ROA,ROE or CR.

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Definitions:

Nonunion Labor

Workers who are not members of a labor union and do not receive the wages and benefits negotiated by unions.

Foreign Firms

Companies that conduct business or operations outside their country of origin.

Union Membership

The state of being a registered member of an organized labor union, representing workers in specific industries or professions.

Union Membership

The state of being a member of a labor union, which represents workers in negotiations with employers over wages, benefits, and working conditions.