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Author Question: A company which favors the residual income approach to financial performance evaluation wants ... (Read 105 times)

Yolanda

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Question 1

A company has operating income of $300,000, revenues of $1,500,000, total assets of $2,000,000 and an ROI of 15%. To improve the ROI, to increase ROI to 20%, which of the following investment turnovers would need to be achieved?
◦ .75
◦ 1.5
◦ 1
◦ 2

Question 2

A company which favors the residual income approach to financial performance evaluation wants managers to ________.
◦ concentrate on maximizing an absolute amount of dollars of residual income as opposed to a percentage yield as is the case with ROI
◦ concentrate on maximizing a percentage return in excess of the cost of capital
◦ maximize the investment turnover ratio
◦ maximize return on sales


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Marked as best answer by Yolanda on Mar 6, 2021

reversalruiz

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Yolanda

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Reply 2 on: Mar 6, 2021
Excellent


jordangronback

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Reply 3 on: Yesterday
Great answer, keep it coming :)

 

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