An operating income is divided by the revenues to calculate ______________?
Correct answer: C. return on sales
- A. residual income
- B. return on after-tax operating income
- C. return on sales
- D. return on investmentCompare Credit Cards
Explanation
Return on sales uses operating income as the numerator and revenue as the denominator. Return on investment would divide operating income by the investment base instead.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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