_1. Total net profit margin measures:
______2. T or F The total asset turnover component of the DuPont method measures the ability of management to generate sales through the effective and efficient use of assets. (if false, identify and correct the error)
______3. If gross profit margin decreased from the prior year, this could be due to all the following, except:
______4. Use the financial information of Sarah Corporation for the year ended December 31, Year 2:
Cost of goods sold |
499,500 |
|
Selling and admin expenses |
95,000 |
|
Net sales |
1,025,000 |
|
Interest expense |
$18,000 |
|
Income tax |
15,000 |
The gross profit and gross profit margin for year 2 are
a. $430,500; 42.0%
b. $525,500; 48.7%
c. $525.500; 51.3%
d. $397,500; 38.8%
_1. Total net profit margin measures: Productive and efficient use of only property plant and equipment...
Return on Assets Net Sales Gross Profit Margin Cost of Goods Operating Net Profit Before Tax PI Expense Accounts Receivable Return On Assets + Merchandise Inventory Total Current Assets Asset Turnover Cash Total Assets Fixed Assets Other Current Assets Use the charts on the following page to calculate Net Profit Margin % for each scenario: Scenario 1 Scenario 2 Income Statement Income Statement Sales Sales Gross Sales $200,000 Gross Sales $100,000 Promotional Allowances $25,000 Promotional Allowances $15,000 Customer Returns -$15,000...
QUESTION 8: Receivables turnover, inventory turnover and gross margin would be critical measures for what type of firm? an electric utility compaany a service firm a merchandising firm an architectural firm QUESTION 10: The higher the equity multiplier, the better. True False QUESTION 11: The ratio that indicates the firm’s ability to use assets to generate operating profit is the basic earning power equity multiplier return on equity days sales outstanding
UNCLUT I LULL 12. Return on common equity 13. Gross profit margin Note: For ratios that call for using average balance sheet figures, compute the rates average balance sheet figures and year-end balance sheet figures. b. Briefly comment on profitability and trends indicated in profitability. Also commento difference in results between using the average balance sheet figures and year end figures P 8-13 Required Answer the following multiple-choice questions: a. Which of the following is not considered to be a...
P 8-13 Required Answer the following multiple-choice questions: Which of the following is not considered to be a nonrecurring itema 1. Discontinued operations 2. Extraordinary items 3. Cumulative effect of change in accounting principle 4. Interest expense 5. None of the above. a. b. Ideally, which of these ratios will indicate the highest return for an indi 1. Return on assets 2. Return on assets variation 3. Return on investments 4. Return on total equity 5. Return on common equity...
Compute the following: (5) debt-to-equity ratio (6) times interest earned (7) net profit margin (8) total asset turnover CADET CORPORATION Income Statement For Year Ended December 31, 2009 Sales $456,600 Cost of goods sold Gross profit Operating expenses 297.450 159.150 99.400 Interest expense 3,900 Income before taxes 55,850 Income taxes 22,499 $ 33,35 Net income CADET CORPORATION Balance Sheet December 31, 2009 Liabilities and Equity Accounts payable Accrued wages payable Income taxes payable Assets S 20,000 Cash 21,500 8,200 Short-term...
CASE STUDY FOR CHAPTER 7 Worker Productivity among Giant U.S. Corporations Traditional measures of firm productivity tend to focus on profit margins, the rate of return on stockholder’s equity, or related measures like total asset turnover, inventory turnover, or receivables turnover. Profit margin is net income divided by sales and is a useful measure of a company’s ability to manufacture and distribute distinctive products. When profit margins are high, it is a good sign that customer purchase decisions are being...
December 31 Assets Cash Accounts receivable Inventory Property, plant, and equipment Accumulated depreciation Total 2022 $ 38,500 22,000 30,800 66,000 (35,200 ) $122,100 2021 $ 22,000 15,400 22,000 85,800 (26,400) $118,800 $ 16,500 8.800 Liabilities and Stockholders' Equity Accounts payable Income taxes payable Bonds payable Common stock Retained earnings $ 20,900 7,700 18.700 19.800 36,300 15,400 S5,000 $122.100 $118,30 $266,200 192.500 73,700 Marigold Conany Income Statement For the Year Ended December 31, 2022 Sales revenue Cost of goods sold Gross...
Measures of liquidity, The ability of a company to make its periodic interest payments and repay the face amount of debt at maturity.Solvency, and The ability of a firm to generate earnings.Profitability The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $ 61 on December 31, 20Y2. Marshall Inc. Comparative Retained Earnings Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 20Y1 Retained earnings, January 1 $...
Measures of liquidity, The ability of a company to make its periodic interest payments and repay the face amount of debt at maturity.Solvency, and The ability of a firm to generate earnings.Profitability The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $ 57 on December 31, 20Y2. Marshall Inc. Comparative Retained Earnings Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 20Y1 Retained earnings, January 1 $4,485,650...
Refer to the ratio analysis example (listed below) and update these ratios for Amazon, Sears, and eBay based on their 2015, 2016, and 2017 annual reports. Review other applicable areas of the annual report, such as the footnotes and MD&A and tell us what the results mean in your own words. What do you think could explain the changes? Defining Ratio Analysis (Continued) You will use ratio analysis throughout the rest of the course. For now, consider the following basic...