Question

Maggie's Skunk Removal Corp.'s 2021 income statement listed net sales of $14.3 million, gross profit of $9.50 million, EBIT of $74 million, net income available to common stockholders of $5.0 million, and common stock dividends of $3.0 million. The 2021 year-end balance sheet listed total assets of $54.3 million and common stockholders' equity of $22.8 million with 20 million shares outstanding Calculate the gross profit margin. (Round your answer to 2 decimal places.) Gross profit margin % Calculate the operating profit margin. (Round your answer to 2 decimal places.) Operating profit margin % Calculate the profit margin (Round your answer to 2 decimal places.) Profit margin

Answer 1

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Given that-			in $ million
i	Net sales		14.3
ii	Gross profit		9.5
iii	EBIT		7.4
iv	Net income		5
v	Stock dividend =		3
vi	Total asset =		54.3
vii	Common stockholder's equity		22.8
viii	Number of share =		2
Ans a)	Gross profit margin= ii/i		66.43%
Ans b)	Operating profit margin = iii/i		51.75%
Ans c)	Profit margin = iv/i		34.97%
Ans d)	Basic earning power = iii/vi		13.63%
Ans e)	Return on asset =iv/vi		9.21%
Ans f)	return on equity = iv/vii		21.93%
Ans g)	dividend payout =v/iv		60.00%