A sign of decreasing earnings quality is:
A)declining cost of goods sold/sales ratio.
B)declining gross margin/sales ratio.
C)declining operating expenses/sales ratio.
D)increasing operating income/sales ratio.

Question

Quizplus · Accepted Answer

A declining gross margin/sales ratio indicates that the company is earning less profit from its sales, which can be a sign of decreasing earnings quality.

A Sign of Decreasing Earnings Quality Is