Problem

Writing Assignment  Effect of land sale on return on assetsToyo Company is holding land th...

Writing Assignment  Effect of land sale on return on assets

Toyo Company is holding land that cost $900,000 for future use. However, plans have changed and the company may not need the land in the foreseeable future. The president is concerned about the return on assets. Current net income is S425.000 and total assets are $3,500,000.

Required

a. Write a memo to the company president explaining the effect of disposing of the land. assuming that it has a current value of $1,500,000.


b. Write a memo to the company president explaining the effect of disposing of the land, assuming that it has a current value of $600,000.

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