Profitability Ratios Multiple Choice Questions (MCQ) PDF Download

MCQ 1: The net income available to stockholders is $125 and total assets are $1,096 then return on common equity would be

1. 0.00114
2. 0.114
3. 0.12
4. 0.12

MCQ 2: The formula such as, net income available for common stockholders divided by total assets is used to calculate

1. return on total assets
2. return on total equity
3. return on debt
4. return on sales

MCQ 3: The net income available to stockholders is $150 and total assets are $2,100 then return on total assets would be

1. 0.0007
2. 0.0714
3. 0.05
4. 7.15

MCQ 4: A formula such as net income available to common stockholders divided by common equity is used to calculate

1. return on earnings power
2. return on investment
3. return on common equity
4. return on interest

MCQ 5: A company's low earnings power and high interest cost cause financial changes, which have

1. high return on equity
2. high return on assets
3. low return on assets
4. low return on equity