If selling and administrative expenses decrease while everything else remains the same, what will happen to return on investment (ROI)?
A)ROI will decrease.
B)ROI will increase.
C)ROI will not be affected.
D)We cannot determine the direction of the effect from the information provided.

Question

Quizplus · Accepted Answer

If selling and administrative expenses decrease while everything else remains the same, the company's net income will increase, leading to higher ROI. Therefore, ROI will increase.

If Selling and Administrative Expenses Decrease While Everything Else Remains