Information Processors

question 4

Multiple Choice

Information processors:

• A) Include information storage.
• B) Interpret, transform, and summarize information for use in analysis and reporting.
• C) Are components of an accounting system that keep data in accessible form.
• D) Are the means to take information out of an accounting system and make it available to users.
• E) Include scanners.

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Definitions:

Relationship of Net Income to Net Sales

A profitability metric that measures the percentage of net sales that ultimately becomes net income, indicating the efficiency of a company in generating profit from sales.

Net Income

The total earnings of a company after all expenses and taxes have been subtracted from total revenue.

Net Sales

This refers to the revenue generated from sales after deducting returns, allowances for damaged or missing goods, and discounts.

Accounts Receivable to Net Sales

A ratio that measures the amount of money owed to a company by its customers relative to the net sales.