Return on Assets Is Calculated as Net Income Divided by Ending

question 76

True/False

Return on assets is calculated as net income divided by ending total assets.Return on assets is calculated as net income divided by average total assets.

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Definitions:

Net Cash Outflow

The result when the cash outgoings (expenses, payments) of a business exceed the incoming cash flow over a specific period of time.

Project

A temporary endeavor with a defined beginning and end, undertaken to meet unique goals and objectives, typically to bring about beneficial change or added value.

Incremental Cash Flow

The additional cash flow a company generates from taking on a new project, representing the difference between the company's cash flow with the project and without it.

Erosion Costs

The negative financial impact resulting from a new project or investment, particularly affecting existing revenue or assets.