The ratio that measures a company's success in using its assets to earn income for the persons who finance the business is the:
A)leverage.
B)rate of return on total assets.
C)debt ratio.
D)times-interest-earned ratio.

Question

Quizplus · Accepted Answer

The rate of return on total assets measures the company's ability to generate income from the assets financed by the business. It indicates how efficiently the company is using its assets to earn income for its stakeholders. The higher the ratio, the better the company's performance in generating income from its assets. The other options (leverage, debt ratio, and times-interest-earned ratio) are measures of the company's financial health, but they do not directly measure the company's ability to generate income from its assets.

The Ratio That Measures a Company's Success in Using Its