Which of the following statements is true?
a. The return on assets ratio indicates whether the company can pay its current debt when it becomes due.
b. The causes for an increase or decrease in the return on assets ratio can be examined by calculating its two components: return on sales and asset turnover.
c. If a company successfully applies leverage, its return on assets ratio will be greater than its return on common stockholders' equity ratio.
d. If a company's return on assets ratio increases, the increase can be the result of decreased liquidity.
b
You might also like to view...
________ harassment exists where a hostile work environment is created based on race
Fill in the blanks with correct word
Allegheny Company ended Year 1 with balances in Accounts Receivable and Allowance for Doubtful Accounts of $78,000 and $4200, respectively. During Year 2, Allegheny wrote off $7800 of Uncollectible Accounts. Using the percent of receivables method, Allegheny estimates that the ending Allowance for Doubtful Accounts balance should be $6400. What amount will Allegheny report as Uncollectible Accounts Expense on its Year 2 income statement?
A. $7800 B. $2200 C. $6400 D. $10,000
What is the firm's marginal profit contribution from sales under the proposed plan of initiating the cash discount? (See Table 14.7)
A) $22,500 B) $40,000 C) $62,500 D) $100,000
Arrojo Corporation manufactures two products: Product X71B and Product C91I. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products X71B and C91I.Activity Cost PoolActivity MeasureTotal CostTotal ActivityMachiningMachine-hours$275,00011,000MHsMachine setupsNumber of setups$210,000350setupsProduct designNumber of products$48,0002productsOrder sizeDirect labor-hours$300,00010,000DLHsActivity MeasureProduct X71BProduct C91IMachine-hours5,0006,000Number of setups220130Number of products11Direct labor-hours6,0004,000Using the plantwide overhead rate, how
much manufacturing overhead cost would be allocated to Product X71B? A. $372,000 B. $499,800 C. $333,200 D. $416,500