Which of the following is a limitation related to the usage of ratios when reviewing a firm's performance?
A) Ratios reveal differences in policy and performance between years.
B) Ratios can be used to compare firms that are in the same industry if one firm's sales are higher than another firm's.
C) Financial ratios are designed for the use of creditors, not for managers.
D) Different accounting practices between firms can distort comparisons.
Answer: D
Business
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The profitability index for a project costing $45,000 and returning $20,000 annually for 5 years at an opportunity cost of capital of 14% is:
a. .526 b. 1.222 c. .655 d. .911
Business
In the context of the types of business products, consumable items that do not become part of a final product are known as__________
Fill in the blanks with correct word.
Business