Use the following information to determine the ROA for the firm
in Fiscal 2012
Precision Tool
2012 Income Statement
Net
sales
$36,408
Less: Cost of goods sold 28,225
Less:
Depreciation
1,760
Earnings before interest and taxes 6,423
Less: Interest paid 510
Taxable Income $5,913
Less: Taxes 2,070
Net income $3,843
Precision Tool
2011 and 2012 Balance Sheets
2011
2012
2011
2012
Cash $2,060
$1,003
Accounts payable $7,250 $8,384
Accounts rec. 3,411
4,218
Long-term debt 9,800 11,500
Inventory 18,776
21,908
Common stock 15,000 17,500
Total $24,247
$27,129
Retained earning 6,357 3,825
Net fixed assets 14,160
14,080
Total assets $38,407 $41,209
Total liab & equity $38,407 $41,209
Answer:
Return on Assets (ROA) = Net Income / Average assets
Average asset of Precision Tool in Fiscal 2012 = ($38,407 + $41,209) / 2 =$39,808
Given:
Net Income for Fiscal 2012 = $3,843
Hence:
ROA = 3843 / 39808 *100 = 9.65%
ROA for the firm in Fiscal 2012 = 9.65%
Use the following information to determine the ROA for the firm in Fiscal 2012 Precision Tool...
P&M Inc. 2012 Income Statement Net Sales 36,408 Cost of Goods Sold 28,225 Depreciation 1,760 EBIT 6,423 Interest Expense 510 EBT 5,913 Taxes 2,070 Net Income 3,843 P&M Inc. 2012 Balance Sheet Cash 1,003 Account Payable 3,668 Account Receivable 4,218 Accrued 4,716 Inventory 21,908 Current Liability 8,384 Current Assets 27,129 Long-term Debt 11,500 Net Fixed Assets 14,080 Common Stock 17,500 Retained Earnings 3,825 Total Assets 41,209 Total Liabilities and Equity 41,209 What is the equity to asset ratio for 2012?...
P&M Inc. 2012 Income Statement Net Sales 36,408 Cost of Goods Sold 28,225 Depreciation 1,760 EBIT 6,423 Interest Expense 510 EBT 5,913 Taxes 2,070 Net Income 3,843 P&M Inc. 2012 Balance Sheet Cash 1,003 Account Payable 3,668 Account Receivable 4,218 Accrued 4,716 Inventory 21,908 Current Liability 8,384 Current Assets 27,129 Long-term Debt 11,500 Net Fixed Assets 14,080 Common Stock 17,500 Retained Earnings 3,825 Total Assets 41,209 Total Liabilities and Equity 41,209 What is the return on equity for 2012? 15.29...
P&M Inc. 2012 Income Statement Net Sales 36,408 Cost of Goods Sold 28,225 Depreciation 1,760 EBIT 6,423 Interest Expense 510 EBT 5,913 Taxes 2,070 Net Income 3,843 P&M Inc. 2012 Balance Sheet Cash 1,003 Account Payable 3,668 Account Receivable 4,218 Accrued 4,716 Inventory 21,908 Current Liability 8,384 Current Assets 27,129 Long-term Debt 11,500 Net Fixed Assets 14,080 Common Stock 17,500 Retained Earnings 3,825 Total Assets 41,209 Total Liabilities and Equity 41,209 How many dollars of sales are being generated from...