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Fundamental Accounting Principles

Which ratios should be used to help answer the following
questions?
(a) How efficient is a company in using its assets to produce
sales?
(b) How near to sale is the inventory on hand?
(c) How many dollars of net income were earned for
each dollar invested by the owners?
(d) How able is a company to meet interest charges as
they fall due?

Solution Preview

Hi there,
<br>
<br>a) Return on assets ratio
<br>
<br>Net income + after tax interest expense / average ...

Solution Summary

This question involves the fundamentals of accounting

$2.19

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