Return on assets is useful in evaluating management, analyzing and forecasting profits, and planning activities.

Question

Quizplus · Accepted Answer

Return on assets (ROA) measures a company's profitability in relation to its total assets. It is useful in evaluating management effectiveness, analyzing current and past profitability, and forecasting future profits. It can also help in planning activities by identifying areas where the company may need to improve its asset utilization. Therefore, the statement is true.

Return on Assets Is Useful in Evaluating Management, Analyzing and Forecasting