An increase in either capital turnover or return on sales,without changing the other,will also ________ the ________.
A)increase; gross book value of long-term assets
B)increase; return on investment
C)increase; cost of capital
D)increase: net book value of long-term assets

Question

Quizplus · Accepted Answer

An increase in either capital turnover or return on sales without changing the other will increase the return on investment, as it is calculated as the product of capital turnover and return on sales. This increase in return on investment will result in higher net income, which ultimately increases the return on investment. The other options are incorrect as they are not directly affected by an increase in either capital turnover or return on sales.

An Increase in Either Capital Turnover or Return on Sales,without