Trestone, a guitar manufacturing company, produces a thousand units of electric guitars each year. The company has been able to sell all its guitars by the end of the fiscal year and earn twice the amount spent on production and marketing. The given scenario indicates that Trestone most likely analyzes _____ for its financial planning.
A) liquidity ratios
B) profitability ratios
C) leverage ratios
D) asset management ratios

Question

Quizplus · Accepted Answer

The scenario indicates that Trestone earns twice the amount spent on production and marketing, which relates to profitability. Therefore, the company most likely analyzes profitability ratios for its financial planning.

Trestone, a Guitar Manufacturing Company, Produces a Thousand Units of Electric