s opvcal year s d the six subtotals or totals on the income statement? classific
ID: 2566251 • Letter: S
Question
s opvcal year s d the six subtotals or totals on the income statement? classifications reported on a balance sheet andor cesfiatis of toekholders' equity for a corporation. classification main and equipment, as reported on the balance sheet, explain (a) cost, (b) accumu- lassifications of stockholders' equity for a corporation. three major categories of notes or footnotes presented in annual reports? Cite an exam- (c) net book value. fpre the major hree major classifications on a statement of cash flows? what are the Brietly define de of edefine return on assets and what it measures What are the MULTIPLE-CHOICE QUE total assets increase, but net income, net sales, and average stockholders' equity remain same, w a Increases. Remains the same. i Cannot be determined without additional information. f company plans to differentiate its products by offering low prices and discounts for items pack- unt retailer that requires memberships for its customers), which component in the Rprofit driver analysis is the company attempting to boost? a. Net profit margin h. Asset turnover c. Financial leverage. d. All of the above. , If a company reported the following items on its income statement (cost of goods sold $6.000, income tax expense $2,000, interest expense $500, operating expenses $3,500, sales revenue S14.000), what amount would be reported for the subtotal "income from operations" a $8,000 h $2,000 c. $4,500 d. $4,000 4 Which of the following is one of the possible nonrecurring items that must be shown in a separate line item below the Income from Continuing Operations subtotal in the income statement? Gains and losses from the sale of fixed assets (L/Extraordinary items. d. Both a and b. b. Discontinued operations. 1 Which of the following reports is filed annually with the SEC? a. Form 10-Q Form 10-K c. Form 8-K d. Press releaseExplanation / Answer
1. Return on Assets ratio is calculated by dividing the Net income of the company by Average of Total Assets employed in the business.
Return on Assets (ROA) = Net Income / Total Assets or Average of Total Assets
If Average of total assets is increased and net income, sales and shareholder's equity remains the same, this means that ROA will decrease as the denominator is increased with numerator remains constant.
Correct answer is B.
b. If company is differentiating its products by offerring discounts on bulk orders, then the company is trying to boost its Asset Turnover Ratio, as it is attempting to increase its sales by luring the customers to purchase goods in bulk quantity for discounts even though company is not able to maximize its net profit on such sales.
Asset Turnover Ratio = Net Sales / Total Assets.
If Sales increases, Asset Turnover ratio will also increase. Correct answer is b.(Asset Turnover Ratio)
c. Income from Operations / EBIT / operating Income = Sales Revenue - Cost of Goods Sold - other operating expenses.
= $14,000 - $6,000 - $3,500 = $4,500
Correct answer is C.
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