In Two Successive Years, It Is Possible for a Firm

question 122

True/False

In two successive years, it is possible for a firm to have identical profit and maintain identical levels of assets, but have different return on equity.

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Definitions:

Trial Balance

A bookkeeping worksheet in which the balances of all ledgers are compiled into debit and credit columns to ensure a company's bookkeeping system is mathematically correct.

Transactions

Financial activities that involve the exchange of assets, services, or liabilities between two parties.

Ledger

An accounting book or computer file for recording and totaling economic transactions measured in terms of a monetary unit and categorized by account type.

Account Titles

Names given to the accounts that reflect the types of transactions they represent, used in bookkeeping to distinguish financial records.