Select the Correct Statement from the Following

question 183

Multiple Choice

Select the correct statement from the following:

• A)Profit margin reflects a company's ability to produce net sales from total assets.
• B)Total asset turnover reflects the percent of net income in each dollar of net sales.
• C)Return on total assets can be separated into the gross margin ratio and debt ratio.
• D)A high return on total assets is desirable.
• E)Analysis of return on total assets is not beneficial in evaluating profitability.

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Definitions:

Ordinary Course

Activities that are considered part of the normal, day-to-day operations of a business.

Assumes Liabilities

The act of taking on the legal debts or obligations of another party, often in the context of business transactions.

Fundamental Change

A significant alteration in the operation, structure, or nature of a business or organization that fundamentally changes its course or identity.

Unanimous Vote

A voting result where all participants cast the same vote, indicating total agreement.