What key performance ratio do stockholders use to determine how much money they will make on their investment?
A) inventory turnover
B) cash from investing activities
C) return on equity
D) receivables turnover
E) current ratio

Question

Quizplus · Accepted Answer

Stockholders are always concerned with how much money they will make on their investment, and they frequently use the return on equity ratio as one of their key performance yardsticks. Return on equity (also called return on investment [ROI]), calculated by dividing net income by owners' equity, shows how much income is generated by each $1 the owners have invested in the firm.

What Key Performance Ratio Do Stockholders Use to Determine How