1 (A).
Profit margin
Choose numerator | / | Choose denominator | = | Profit margin ratio | ||
Net income | / | Net sales | = | Profit margin ratio | ||
BioBeans | 11,375 | / | 115,000 | = | 9.89 | % |
Green kale | 2,800 | / | 69,600 | = | 4.02 | % |
1 (B).
Return on total assets
Choose numerator | / | Choose denominator | = | Return on assets | ||
Net income | / | Average total assets | = | Return on assets | ||
BioBeans | 11,375 | / | 227,500 | = | 5 | % |
Green kale | 2,800 | / | 174,000 | = | 1.61 | % |
2.
The preferred investment is Biobeans since its profit margin ratio and return on assets are higher than Greenkale.
Following are data for BioBeans and GreenKale, which sell organic produce and are of similar size....
Following are data for BioBeans and GreenKale, which sell organic produce and are of similar size. Average total assets Net sales Net income BioBeans Greenkale $227,500 $174,000 115,000 69,600 11,375 2,800 Required: 1a. Compute the profit margin for both companies. 1b. Compute the return on total assets for both companies. 2. Based on analysis of these two measures, which company is the preferred investment? Complete this question by entering your answers in the tabs below. Req 1A Req 1B Required...
Following are data for BioBeans and GreenKale, which sell organic produce and are of similar size. Average total assets Net sales Net income BioBeans GreenKale $227,500 $174,000 115,000 69,600 11,375 2,800 Required: 1a. Compute the profit margin for both companies. 1b. Compute the return on total assets for both companies. 2. Based on analysis of these two measures, which company is the preferred investment? Complete this question by entering your answers in the tabs below. Req 1A Reg 1B Required...
Following are data for BioBeans and GreenKale, which sell organic produce and are of similar size. Average total assets Net sales Net income BioBeans GreenKale $195,000 $154,500 65,000 77,250 13,650 7,000 Required: 1a. Compute the profit margin for both companies. 1b. Compute the return on total assets for both companies. 2. Based on analysis of these two measures, which company is the preferred investment? Complete this question by entering your answers in the tabs below. Reg 1A Reg 1B Required...
Required information Problem 13-5A Comparative ratio analysis LO A1, P3 [The following information applies to the questions displayed below.] Summary information from the financial statements of two companies competing in the same industry follows. Barco Kyan Barco Kyan Company Company Company Company Data from the current year-end balance sheets Data from the current year's income statement Assets Sales $810,000 $891,200 Cash $ 18,500 $ 34,000 Cost of goods sold 587,100 638,500 Accounts receivable, net 38, 400 58, 400 Interest expense...
Selected current year-end financial statements of Cabot Corporation
follow. (All sales were on credit, selected balance sheet amounts
at December 31 of the prior year were inventory \$55,900 ; total
assets, \$189.400 common stock, $89,000; and retained earnings
$38,032.)
CABOT CORPORATION Income Statement For Current Year Ended December 31 Sales $ 450,600 Cost of goods sold 297,150 Gross profit 153,450 Operating expenses 99,300 Interest expense 4.300 Income before taxes 49,850 Income tax expense 20,082 Net income 29, 768 Assets Cash...
Selected current year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31 of the prior year were inventory, $49,900; total assets. $199,400; common stock, $81,000; and retained earnings, $29,718.) CABOT CORPORATION Income Statement For Current Year Ended December 31 Sales $ 448,600 Cost of goods sold 297,050 Gross profit 151,550 Operating expenses 99, 300 Interest expense 3,800 Income before taxes 48,450 Income tax expense 19,518 Net Income $ 28,932 Assets Cash...
Summary information from the financial statements of two companies competing in the same industry follows. Barco Kyan Company Company Data from the current year and balance sheets Assets Cash $ 21,000 $31.000 Accounts receivable, et 37.400 54,400 Current notes receivable (trade) 9,800 3.200 Merchandise inventory 84,840 134,500 Prepaid expenses 6,200 2,850 Plant annets, net 290,000 306,400 Total assets $449,240 $542,350 Barco Kyan Company Coepany Data from the current year's income statement Sales $800,000 $920,200 cost of goods sold 587,100 634.500...
Problem 13-4A Calculating financial statement ratios LO P3 Selected current year-end financial statements of Cabot Corporation follow. (All sales were on credit; selo at December 31 of the prior year were inventory, $50,900; total assets, $209,400; common stock, $83,00 $54,315.) CABOT CORPORATION Income Statement For Current Year Ended December 31 Sales $ 452,600 Cost of goods sold 297,550 Gross profit 155,050 Operating expenses 99,500 Interest expense 4,500 Income before taxes 51,050 Income tax expense 20,565 Net income $ 30,485 $...
The following information applies to the questions displayed below.) Summary information from the financial statements of two companies competing in the same industry follows. Kyan Company Barco Kyan Company Company Data from the current year-end balance sheets Assets Cash $ 22,000 $35,000 Accounts receivable, net 35,400 57,400 Current notes receivable (trade) 9.300 7.800 Merchandise inventory 84,440 128,500 Prepaid expenses 5,600 7,500 Plant assets, net 350,000 305,400 Total assets $506,740 $541.600 Barco Company Data from the current years income statement Sales...
Selected current year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31 of the prior year were inventory, $48,900; total assets, $189,400; common stock, $90,000; and retained earnings, $33,748.) CABOT CORPORATION Income Statement For Current Year Ended December 31 Sales $ 448,600 Cost of goods sold 297,250 Gross profit 151,350 Operating expenses 98,600 Interest expense 4,100 Income before taxes 48,650 Income tax expense 19,598 Net income $ 29,052 Assets Cash Short-term...