The strategic profit model is useful to retailers because it:
A) is derived from the income statement
B) uses owner's equity as its primary criterion
C) uses inventory turnover as its primary criterion
D) is derived from the balance sheet from the last day of the year
E) combines margin management and asset management

Question

Quizplus · Accepted Answer

The strategic profit model combines both margin management and asset management, making it useful for retailers to analyze and improve their profitability. It is a tool that indicates how changes in sales, expenses, and asset utilization will impact a retailer's return on investment, and it helps retailers to identify areas where improvements can be made to increase profitability.

The Strategic Profit Model Is Useful to Retailers Because It