Question 1. A decrease in warranty liabilities increases net sales. Why?
a. True
b. False
Question 2. A company with anticipated earnings-per-share growth is worth more. Why?
a. True
b. False
Question 3. A reduction in the advertising expense ratio increases return on common equity and share value. Why?
a. True
b. False
Question 4. An underestimate expenses to increase profit margins can create net operating assets. Why?
a. True
b. False
Question 5. The higher a firm's contribution margin ratio, the more leverage it gets from increasing sales. Why?
a. True
b. False