The Rules of Accounting Generally Require That ________ Be Included

question 44

Multiple Choice

The rules of accounting generally require that ________ be included in a firm's financial records.

• A)only implicit costs
• B)only explicit costs
• C)both explicit costs and implicit costs
• D)neither explicit costs nor implicit costs

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Definitions:

Leverage Ratio

A financial ratio that measures the amount of debt used in a company's financing structure relative to its equity or other assets.

Pretax Profit/EBIT

Earnings before interest and taxes, a measure of a company's profitability that excludes interest and income tax expenses.

Asset Turnover Ratio

A financial metric that measures the efficiency of a company's use of its assets in generating sales revenue.

Current Ratio

A liquidity measure that compares a company's current assets to its current liabilities.