________ reveal an inefficient use of assets that restricts profitability.
A)Sales-force analyses
B)Concentration ratios
C)Financial ratios
D)Competitive analyses

Question

Quizplus · Accepted Answer

Financial ratios are used to analyze the efficiency of asset utilization and can reveal if a company is not making the most of its assets. For example, a low return on assets (ROA) ratio indicates that a company is not generating enough profit relative to its total assets, which suggests an inefficient use of assets that restricts profitability. Sales-force analyses, concentration ratios, and competitive analyses do not directly provide insight into asset utilization efficiency.

________ Reveal an Inefficient Use of Assets That Restricts Profitability