What does the ratio return on investment (ROI) measure and what are some possible ways it can be computed?
ROI measures the rate of return generated by an investment center's assets. In general, the higher the return, the better.
There are two ways it can be computed.
First, it can be computed by simply dividing net operating income by average operating assets.
Alternatively, it can be computed by multiplying together two other ratios called "margin" and "turnover". Margin is computed by taking net operating income and dividing it by sales. Turnover is computed by taking sales and dividing it by average operating assets.
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Use the DuPont method to calculate the 2013 ROE for Bacon Signs
A) 0.0961 * 0.46 * 4.30 = 0.1698 = 16.98% B) 0.0961 * 0.46 * 1.81 = .0796 = 7.96% C) 0.0961 * 0.41 * 1.88 = .0741 = 7.41% D) 0.0961 * 0.41 * 1.00 = 0.0395 = 3.95%
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a. True b. False Indicate whether the statement is true or false
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Answer the following statement true (T) or false (F)
Major projects, such as corporate mergers or buyouts, can adversely affect the long-term solvency ratio of a company
Indicate whether the statement is true or false.