Select the appropriate definition for each of the items listed below.
-The ratio of operating income to sales.
A)Turnover
B)Margin
C)ROI
D)Residual income

Question

Quizplus · Accepted Answer

The definition fits the term "Margin," which measures the company's efficiency in converting sales into profits by calculating the percentage of operating income generated per dollar of sales.

A) Turnover refers to the number of times a company converts its inventory into sales over a given period.

C) ROI (Return on Investment) measures the efficiency of an investment by calculating the ratio of the return to the cost of investments.

D) Residual Income measures the amount of profit that remains after deducting the cost of capital from the net operating income.

Select the Appropriate Definition for Each of the Items Listed