Return Ratios Are Measures of the Relationship Between the

question 104

Multiple Choice

Return ratios are measures of the relationship between the

• A)income earned and the investment made in the company by the various groups.
• B)revenue earned and the total equity of a company.
• C)total equity of a company and its cash flows for the period.
• D)profitability and liquidity aspects of a company.

---

Definitions:

External Sales Price

The price at which a product or service is sold to customers outside of the company, as opposed to internal transfer pricing within different divisions of the same company.

Opportunity Cost

Opportunity Cost refers to the potential benefits or income lost when choosing one alternative over another.

Direct Expenses

Costs that can be directly attributed to a specific product, service, or project, such as raw material costs.

Market Trends

The general direction in which a market or the prices of a particular set of goods and services is moving.