A more comparable measure of profitability than income is return on assets,which equals net income divided by average total assets.

Question

Quizplus · Accepted Answer

Return on assets (ROA) is a measure of profitability that takes into account the assets used to generate that profit. It is calculated by dividing net income by average total assets. This provides a more accurate measure of profitability than just looking at income alone. Therefore, the statement is true.

A More Comparable Measure of Profitability Than Income Is Return