The ratio that gives the indication of the efficiency of a firm’s sales with respect to cost of goods sold is a?

A. return on capital employed
B. gross profit margin
C. net profit margin
D. return on equity

Correct Answer:

Option A – return on capital employed

Explanation

Return on capital employed or ROCE is a profitability ratio that measures how efficiently a company can generate profits from its capital employed by comparing net operating profit to capital employed.