One of the Drawback of the Return on Investment Performance

question 52

True/False

One of the drawback of the return on investment performance measure is that it considers both operating and nonoperating income.

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Definitions:

Net Markdowns

The total reduction in selling price of inventory, subtracting markdown reversals, to adjust for decrease in market value or to stimulate sales.

Employee Discounts

Reduced prices offered to employees by their employer as a part of their employment benefits or incentives.

Periodic Inventory System

An inventory accounting system where updates to inventory records are made on a periodic basis, not continuously.

Physical Inventory

A process of counting and verifying the actual inventory on hand at a business location, typically performed at the end of an accounting period.