A Business Reports the Following in Its Financial Statements Its Rate of Return on Total Assets Is:
A) 19

question 2

Multiple Choice

A business reports the following in its financial statements:
$$\begin{array} { l l } \text { Net profit before tax } & \$ 150 \\\text { Interest expense } & 20 \\\text { Income tax expense } & 30 \\\text { Total assets at the beginning of the year } & 700 \\\text { Total assets at the end of the year } & 850\end{array}$$
Its rate of return on total assets is:

• A) 19.4%
• B) 21.9%
• C) 16.8%
• D) 4.83%

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Definitions:

Automated Equipment

Machinery that operates with minimal human intervention, often used to increase production efficiency and consistency.

Salvage Value

The estimated residual value of an asset at the end of its useful life, often considered in depreciation calculations.

Financially Attractive

A term describing investments, projects, or acquisitions that are appealing due to their potential for financial return or profitability.

Proposed Project

An outlined plan or proposal for a future project, often including objectives, methodologies, and potential impacts.