Question

The best indication of the operational efficiency of management is?

A. net income
B. earnings per share
C. EBIT
D. gross profit

I like net income as a metric for operational efficiency because net income is how much money the company has after to paid all the bills and taxes...

A is my FINAL ANSWER

I that correct?

Answer 1

I don't think net income is a good indication of operational efficiency. It doesn't take into account that a large company will have a higher net income than a small company.

What about EBIT?

http://www.investopedia.com/terms/e/ebit.asp

Answer 2

ebit