Which of the Following Is True of the Asset Turnover

question 9

Multiple Choice

Which of the following is true of the asset turnover ratio?

• A)It measures how efficiently a business uses its sales to finance the assets.
• B)It measures how efficiently a business uses its average total assets to generate sales.
• C)It measures how efficiently a business uses its net profit to finance the assets.
• D)It measures how the ending inventory helps in increasing the value of assets.

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Definitions:

Hemoglobin

A protein in red blood cells responsible for transporting oxygen from the lungs to the rest of the body.

Oxygen

A chemical element with symbol O, essential for most life forms on earth, involved in respiration and energy production in cells.

Drain

To remove fluid, often from a body cavity, wound, or other source of accumulation, typically using a tube or other mechanism.