Which of the Following Is the Best Indicator of Management's

question 103

Multiple Choice

Which of the following is the best indicator of management's effectiveness at generating profits relative to the firm's assets?

• A)Quick ratio
• B)Fixed assets turnover
• C)Operating income return on investment
• D)Accounts receivable turnover

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Definitions:

Common Stock

Equity ownership in a corporation, giving holders voting rights and a share in the company's profits via dividends.

Equity Method

An accounting technique used to assess the profits earned by investments in other companies, where the investment income is proportional to the ownership stake.

Common Stock

A type of equity security that represents ownership in a corporation, with holders entitled to vote on corporate matters and receive dividends.

Noncontrolling Interest

The equity in a subsidiary not attributable, directly or indirectly, to a parent company.