The Cash Flow on Total Assets Ratio Is Calculated By

question 52

Multiple Choice

The cash flow on total assets ratio is calculated by:

• A) Dividing cash flows from operations by average total assets.
• B) Dividing total cash flows by average total assets.
• C) Dividing average total assets by cash flows from investing activities.
• D) Total cash flows divided by average total assets times 365.
• E) Dividing average total assets by total cash flows.

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Definitions:

Accrual Adjusting Entry

An accounting entry made to record revenues that have been earned or expenses that have been incurred but not yet recorded through the normal transaction process.

Interest Expense

The financial charge for the use of borrowed capital, reflected in the income statement.

Insurance Expense

The cost associated with purchasing insurance policies to protect against risks, often reported as an operating expense.

Income Statement Accounts

Income statement accounts include all the revenue and expense accounts that determine a company's net income or net loss for a specific period.