Inadequacy Refers to the Insufficient Capacity of a Company's Property

question 31

True/False

Inadequacy refers to the insufficient capacity of a company's property, plant and equipment to meet the company's growing productive demands.

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Definitions:

Return on Assets

A financial metric that assesses a firm's ability to generate earnings from its assets, determined by dividing its net income by its overall assets.

Earning Per Share

The earnings a company makes per share of its common stock outstanding, signifying how profitable the company is.

Total Equity

The value left in a company after deducting total liabilities from total assets, representing the ownership value in the company.

Profit Margin

A financial metric expressed as a percentage, indicating how much of each dollar in revenue is translated into profit.