Question
1. As an investor of a company, you want to find out your ROI provided by the company at the end of the current year.
1. As an investor of a company, you want to find out your ROI provided by the company at the end of the current year. Which of the following formulas would you use?
Group of answer choices
Net Income divided by the Average Asset of the company.
Net Income divided by the Sales amount of the company.
Net Income divided by the Equity amount of the company's ending Balance Sheet.
Net Income divided by the average amount of the Total Equities of the beginning & ending Balance Sheets of the company
2. You want to find out whether the management of a company had invested well to generate enough revenues. Which of the following formulas would you use?
Group of answer choices
Net Income divided by the average Assets of the beginning & ending Balance Sheets
Revenues divided by the average Assets of the beginning & ending Balance Sheets
Net Income divided by the Revenues
Net Income divided by the average Equity of the beginning & ending Balance Sheets
3. We know that all the decisions made by the management of a company must be made to maximize the value of the company so that its owners wealth is maintained at its maximum level (or amount). Which one of the following describes best the ultimate measurement of this effort? (Limit your answer to publicly traded companies.)
Group of answer choices
Maximizing its revenues amount ($) continuously each year
Maximizing its net profit amount ($) continuously each year
Increasing the size of Shareholders Equity (Owners Equity) ($ as well as its % over Total Assets) of the Balance Sheet continuously each year
Coordinating management policies and operational efficiency, along with financing decisions to maintain the stock price at the highest level in the market
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