Return on Investment Measures the Profitability of an Investment Center

question 239

True/False

Return on investment measures the profitability of an investment center but not the efficiency in using its assets.

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Definitions:

Rent Revenue

Money received for rent.

Purchases Discounts

Reductions in price given by suppliers to businesses when they buy goods or services, often provided for early payment.

Freight In

The cost associated with the transportation of goods or materials into a business, typically considered part of the cost of goods sold.

Gross Profit

The difference between revenue and the cost of goods sold before accounting for certain other costs.