Which of the Following Statements Is True

question 57

Multiple Choice

Which of the following statements is true?

• A) A gross profit ratio that is declining over time indicates a reduction in the margin between the purchase price and the selling price of goods.
• B) An expense to sales ratio of 20% in year 1 and 22% in year 2 indicates that management policies to control expenses are succeeding.
• C) Generally speaking the slower the turnover of inventory the greater the profitability of the business.
• D) The formula for the inventory turnover ratio is sales divided by average inventory.

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Definitions:

Unpleasant Circumstances

Situations or conditions that are difficult, uncomfortable, or distressing to experience or endure.

Inter-team Group Technique

A method aimed at enhancing cooperation and efficiency among different teams within an organization by improving communication and resolving conflicts.

Consensus

A group decision that has the expressed support of most members.

Authority Rule

A system or principle governing conduct or activity, where decisions are made based on hierarchical position or statutory power.