From the viewpoint of a stockholder, which of the following relationships do you consider of least significance?
A) The return on assets consistently is higher than the industry average.
B) The return on equity has increased in each of the past five years.
C) Net income is greater than the amount of working capital.
D) The return on assets is greater than the rate of interest being paid to creditors.

Question

Quizplus · Accepted Answer

Net income being greater than the amount of working capital is less significant to a stockholder compared to return on assets, return on equity, and the return on assets being greater than the rate of interest being paid to creditors. Working capital represents the amount of current assets available to cover current liabilities, and while it is important for a company's liquidity and short-term solvency, it may not directly impact the return to the stockholder.

From the Viewpoint of a Stockholder, Which of the Following