In each of the last five years, the net sales of Plaza Co. have increased at about half the rate of inflation, but net income has increased at approxi?mately twice the rate of inflation. During this period, the company's total assets, liabilities, and equity have remained almost unchanged; dividends are approximately equal to net income. These relationships suggest (indicate all correct answers):
A) Management is successfully controlling costs and expenses.
B) The company is selling more merchandise every year.
C) The annual return on assets has been increasing.
D) Financing activities are likely to result in a net use of cash.

Question

Quizplus · Accepted Answer

The Answer of In each of the last five years, the net sales of Plaza Co. have increased at about half the rate of inflation, but net income has increased at approxi?mately twice the rate of inflation. During this period, the company's total assets, liabilities, and equity have remained almost unchanged; dividends are approximately equal to net income. These relationships suggest (indicate all correct answers):
A) Management is successfully controlling costs and expenses.
B) The company is selling more merchandise every year.
C) The annual return on assets has been increasing.
D) Financing activities are likely to result in a net use of cash.

In Each of the Last Five Years, the Net Sales