According to accounting principles: depreciation is a cash expense operating expenses during the year are tied to revenues they helped to generate current assets should equal current liabilities net working capital should equal zero Return on Equity is most accurately described as a measure of: return on assets combined with liquidity the return available to all stockholders in the company is the amount of net income paid to retained earnings alter allowing for paid the return on common stockholder investment If the Inventory Turnover Ratio is very high relative to industry averages: the firm has too high a level of inventory the firm has too many items that the customers probably do not want the firm has good total assets management practices the firm may he losing sales if its inventory is too low