Match the correct ratio name from the list below labeled a through g with each formula appearing in items
-(Net income + interest expense) / average total assets
A) Return on sales
B) Quick ratio
C) Average tax rate
D) Current ratio
E) Return on assets
F) Return on equity
G) Inventory turnover

Question

Quizplus · Accepted Answer

The formula (Net income + interest expense) / average total assets is used to calculate the Return on Assets (ROA). This ratio measures how efficiently a company can manage its assets to produce profits during a period.

Match the Correct Ratio Name from the List Below Labeled