Which of the following is not considered “income return” on an investment?

Which of the following is not considered “income return” on an investment?

Interest income on a bond
Capital gain on a stock
Dividend income on a stock
Net rental income on an apartment building.

Expert Solution

Option B is the answer

Capital Gains on a stock

Capital gain is not a income return, as it is realised from the change in value of investment

jeff jeffy answered 2 years ago

Which of the following is not considered a capital investment? The purchase of a large machine....

Which of the following is not considered a capital investment? The purchase of a large machine. The purchase of a large order of raw materials used in the production process. The acquisition of a subsidiary company The development of a new product line.

Which of the following is considered to be a limitation of income statements? Select one: a....

Which of the following is considered to be a limitation of income statements? Select one: a. Income statements depend on accounting methods selected. b. Income statements evaluate past performance. c. Income statements predict future performance. d. Income statements assess uncertainties of achieving future cash flows.

Return on investment (ROI) is often expressed as follows: Income / Investment = Income / Revenues...

Return on investment (ROI) is often expressed as follows: Income / Investment = Income / Revenues x Revenues / Investment 1. What advantages are there in the breakdown of the computation into two separate components? 2. Fill in the blanks for the following table: Companies in Same Industry A B C Revenues $1,600,000 $1,300,000 ? Income $96,000 $78,000 ? Investment $800,000 ? $2,600,000 Income as a percentage of revenues ? ? 1.5 % Investment turnover ? ? 2 ROI ?...

An investment would be considered a good prospect under which of the following conditions?

Which is an investment and which is a return of cash to shareholders?

Which is an investment and which is a return of cash to shareholders?____INvestment in a new internal project_____ Acquisition of another company____Paying off debt_____ Paying dividends______ Purchasing stock

Which of the following is generally considered to represent the risk-free return? A. common stocks B....

Which of the following is generally considered to represent the risk-free return? A. common stocks B. small stocks C. long-term corporate bonds D. treasury bills

9. Which of the following is a performance measure of profit centers? A. return on investment...

9. Which of the following is a performance measure of profit centers? A. return on investment B. residual income C. contribution margin D. economic value added 10. Which of the following is not a decision that investment center can make? A. Where to buy the materials B. Selling price of the product made C. How much operating assets are used in operation D. How much funds are invested in stocks E. How much wages to pay to...

In an incremental rate of return analysis, which of the following investment criteria apply (select the...

In an incremental rate of return analysis, which of the following investment criteria apply (select the best answer): If the incremental IRR is greater than or equal to the MARR, retain the higher-cost alternative If the incremental IRR is less than the MARR, retain the lower-cost alternative If the incremental IRR is greater than or equal to the MARR, retain the lower-cost alternative If the incremental IRR is less than the MARR, retain the higher cost alternative Both (a) and...

Explain and contrast return on investment and residual income. Provide examples.

Profit Margin, Investment Turnover, and return on investment The condensed income statement for the Consumer Products...

Profit Margin, Investment Turnover, and return on investment The condensed income statement for the Consumer Products Division of Fargo Industries Inc. is as follows (assuming no service department charges): Sales $912,000 Cost of goods sold 410,400 Gross profit $501,600 Administrative expenses 228,000 Income from operations $273,600 The manager of the Consumer Products Division is considering ways to increase the return on investment. a. Using the DuPont formula for return on investment, determine the profit margin, investment turnover, and return on...

Question