Which of the Following Could Cause Return on Net Operating

question 50

Multiple Choice

Which of the following could cause return on net operating assets to increase, all things other equal?

• A) A decrease in interest rate on debt
• B) Increase in days accounts receivable are outstanding
• C) Increase in inventory turnover
• D) Decrease in gross margin

---

Definitions:

Production Process

The sequence of operations or steps taken to convert raw materials into finished goods.

Weighted-Average Method

An inventory costing method that assigns a weighted average cost to items, blending the costs of similar items.

Units Transferred

The quantity of goods moved from one process, department, or stage of production to another.

Cost Category

A classification of costs based on their nature or function within a business, often used for accounting and budgeting purposes.