If the Investment Turnover Ratio Changes from 3

question 31

Multiple Choice

If the investment turnover ratio changes from 3.3 times to 4.1 times then,no matter what other factors may change,this indicates that:

• A) return on investment will be lower.
• B) return on investment will be higher.
• C) less sales are being generated relative to investment.
• D) more sales are being generated relative to investment.

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Definitions:

Financial Statements

Documents that provide an overview of a company's financial condition in both short-term and long-term contexts, including the balance sheet, income statement, and cash flow statement.

Adjustment for Depreciation

The accounting process of allocating the cost of a tangible asset over its useful life to account for the reduction in value over time.

Balance Sheet

A financial statement that displays a company's financial position at a specific point in time, showing assets, liabilities, and equity.

Assets

Resources owned by a company that have economic value and can provide future benefits, such as cash, inventory, and property.