Question

Return on Assets Ratio and Asset Turnover Ratio United Systems reported the following financial data (in millions) in its annual report: 2018 2019 Net Income $21,500 $16,134 Net Sales 49,540 52,250 Total Assets 68,734 78,128 If the company's total assets are $65,676 in 2017, calculate the company's: (a) return on assets (round answers to one decimal place - ex: 10.7%) (b) asset turnover for 2018 and 2019 (round answers to two decimal places) 2018 2019 0 % a. Return on Assets Ratio 0 % b. Asset Turnover Ratio 0 0

Answer 1

2018 al Retwin on Assets Ratio 31.90%. bi Asset Twinover Ratio 017 2019 21.907- 0.1 Year 2018: a. Ret win on Assets Ratio =- Net income Average total assets Total assets of 2018 + Total ass of 2017 Average total assets = $ 68,734 + $ 65, 676 2 $ 134,410 $ 67, 205 Retwin on asset Ratio = $21,5oo & 67205 - 31.9%. b. Asset Turnover Ratio = Net sales Average total assets Average total Asset assets is calculated in partia) Turnover Ratio = $ 49, suo $67, 205 = 0.7

Year 20198 a Return on Assets Ratio = – Net income Average total assets assets of 2019 + Total total Average assets = Total 07 2018 & 78, 120 + $ 68, 734 2 $ 146,862 = $ 73431 2 Return on Assets Ratio - $ 16, 134 $ 73,43) = 21.90% b. Asset Average Turnover Ratio - Net sales Average Total assets total assets is calculated in part (a) Asset Turnover Ratio = $ 52,250 $ 73, 431