M: Business 3rd Edition by O. C. Ferrell, Geoffrey Hirt, Linda Ferrell

Exercise 62

Profitability ratios are used to measure

A. how efficiently a firm uses its assets to generate sales.

B. the speed with which a company can turn its short-term assets into cash to pay off its short-term debts.

C. how much income (net or operating) a firm generates relative to its assets, equity, and sales.

D. how much debt the firm is using relative to other sources of financing.

E. the performance of the firm relative to others on a per-share basis.