Question

. CALCULATOR PRINTER VERSION BACK NEXT ASSIGNMENT RESOURCES BB Week 03 Homework Question 1 Question 2 Question 3 Question 4 Question 4 Carla Vista Co. reports the following information (in millions) during a recent year: net sales, $9,740.0; net earnings, $331.2; total assets, ending, $4,465.0; and total assets, beginning, $5,275.0. Review Score Review Results by Study Objective Mobile Site (a) Calculate the (1) return on assets, (2) asset turnover, and (3) profit margin. (Round answers to 1 decimal place, e.g. 6.2% and 6.2.) 1. Return on assets 2. Asset turnover times 3. Profit margin LINK TO TEXT Question Attempts: 0 of 3 used SAVE FOR LATER SUBMIT ANSWER

Answer 1

1	Return on assets [Refer working note 1]	6.8%
2	Asset turnover [Refer working note 2]	2	times
3	Profit margin [Refer working note 3]	3.4%

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Working note 1 Return on assets: Return on Assets ratio (ROA) is a profitability ratio that measures the earnings produced by the total assets during a period. In other words, it measures the returns generated by the total capital invested in the business. Average assets = (Beginning total assets + Ending total assets) / 2 =($5,275 + $4,465)/2 = $4,870 Net Income Return on total assets =- ge total assets x 100 $331.2 $4,870 x 100 = 6.8% (rounded to 1 decimal place) Working note 2 Net sales Asset turnover = Average total assets $9,740 $4,870 = 2 times Working note 3 Net Income Profit Margin = Net Sales x 100 $331.2 $9,740 x 100 = 3.4% (rounded to 1 decimal places)