Return on Assets:
The return on assets is the return earned on the amount invested in assets. The return on assets is also known as the
Net Income:
Total earning of the company is called net income of the company. When the total expense deducted from the total revenue than the resultant is net income or ne loss.Net profit of the company is also called net profit. The investor can take a decision on the basis of net income of the company. If net income is more the investor attract to the company.
1.
To compute: Return on assets of C and P Company.
2.
To compare: The performance of companies on the basis of sales.
3.
To compare: The performance of companies on the basis of net income from its asset invested.
4.
To analyze: The Company for investment purpose.
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FINANCIAL ACCT.FUND.(LOOSELEAF)
- The 2024 income statement of Adrian Express reports sales of $20,310,000, cost of goods sold of $12,500,000, and net income of $1,900,000. Balance sheet information is provided in the following table. Assets Current assets: Cash Accounts receivable Inventory ADRIAN EXPRESS Balance Sheets December 31, 2024 and 2023 Long-term assets Total assets Liabilities and Stockholders' Equity Current liabilities Long-term Liabilities Common stock Retained earnings Total liabilities and stockholders' equity Industry averages for the following four risk ratios are as follows: Gross profit ratio Return on assets Profit margin Asset turnover Return on equity 45% 25% 15% 6.5 35% tines 2024 2023 $800,000 $910,000 1,725,000 1,175,000 2,175,000 1,625,000 5,000,000 4,390,000 $9,700,000 $8,100,000 $2,030,000 $1,820,000 2,490,000 2,560,000 2,025,000 1,975,000 3,155,000 1,745,000 $9,700,000 $8,100,000arrow_forwardRevenues Cost of goods sold Earnings Total assets Shareholders equity Coca-Cola $41,866 16,456 6,536 87,274 23,050 Pepsico $62,806 28,211 6,324 74,140 11,252 Keurig Dr Pepper $6,435 2,591 849 9,800 2,130arrow_forwardSaved Help Edison Co. reported the following for the current year: Net sales Cost of goods sold Net income Beginning balance of total assets Ending balance of total assets $80,000 $56,000 $16,000 $60,000 $68,000 Compute (a) profit margin and (b) return on total assets. Complete this question by entering your answers in the tabs below. Profit Margin Ratio Return On Total Assets Compute the return on total assets. Return On Total Assets Choose Denominator: Choose Numerator: Return On Total Assets Return on total assets < Profit Margin Ratio Relue O Te Asesie < Prev 7 of 7 Next ere to search a 米 *5 # & * 4 8. W E R Y S G J K LL %24arrow_forward
- Problem 1: Viance Queen Company Required: Compute for the company’s profitability and operating efficiency ratios for 2019 Compute for the financial health ratios of the company for 2019 A.Profitability ratio Return on Assets: ROA (EBIT/Average Assets) ROE (NI/Capital) ROE (NI/Average Capitalarrow_forwardEdison Company reported the following for the current year: $ 84,000 59,000 21,080 63,000 77,080 Net sales Cost of goods sold Net income Beginning balance of total assets Ending balance of total assets Compute (a) profit margin and (b) return on total assets. Complete this question by entering your answers in the tabs below. Profit Margin Ratio Compute the return on total assets. Return On Total Assets Numerator: 7 7 7 Return On Total Assets Denominator: = Return On Total Assets Return on total assets II =arrow_forwardPerform comparative analysis of Eastman Corporation by completing the analysis below. PROBLEM 1-3 Describe and comm ent on any significant findings in y our co mparative analysis. Comparative Income Statemenrt Analysis EAST MAN COR PORATION Income State ment ($ millions) For Years Ended December 31 Average Cumulative Annual Year 6 Year 5 Year 4 Amount Amount Net sales 21 3,210 %24 2,610 $3,490 $2,860 %24 Cost of goods sold Gross profit. - 3,670 680 1,050 1,800 Operating expenses Income before taxes 2,740 215 105 Net inc ome $1,485 145 58 CHECK Average net income. $563arrow_forward
- THE COCA-COLA COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (In millions except per share data) Year Ended December 31, Net Operating Revenues Cost of goods sold Gross Profit Selling, general and administrative expenses 2019 2018 2017 37,266 S 34,300 S 36,212 14,619 13,067 13,721 22,647 21,233 22,491 12,103 11,002 12,834 458 1,079 1,902 Other operating charges 10,086 9,152 7,755 Operating Income Interest income 563 689 679 946 950 853 Interest expense Equity income (loss)-net 1,049 1,008 1,072 34 (1,674) (1,763) Other income (loss)- net 10,786 8,225 6,890 Income Before Income Taxes 1,801 1,749 5,607 Income taxes 8,985 6,476 1,283 Consolidated Net Income 42 35 Less: Net income (loss) attributable to noncontrolling interests Net Income Attributable to Shareowners of The Coca-Cola Company 65 8,920 S 6,434 S 1,248 2.09 S 1.51 $ 0.29 Basic Net Income Per Share 2.07 S 1.50 $ 0.29 Diluted Net Income Per Shard 4,276 4,259 4,272 Average Shares Outstanding- Basic 38 40 52 Effect of…arrow_forwardTop executive officers of Tildon Company, a merchandising firm, are preparing the next year's budget. The controller has provided everyone with the current year's projected income statement. Current Year $1,600,000 1,120,000 480,000 190,000 Sales revenue Cost of goods sold Gross profit Selling & administrative expenses Net income 290,000 Cost of goods sold is usually 70 percent of sales revenue, and selling and administrative expenses are usually 10 percent of sales plus a fixed cost of $30,000. The president has announced that the company's goal is to increase net income by 15 percent. Required The following items are independent of each other: a. Prepare a pro forma income statement. What percentage increase in sales would enable the company to reach its goal? b. The market may become stagnant next year, and the company does not expect an increase in sales revenue. The production manager believes that an improved production procedure can cut cost of goods sold by 2 percent. Prepare a…arrow_forwardVertical analysis (common-size) percentages for Baker Company’s sales revenue, cost of goods sold, and expenses are as follows. Did Baker’s net income as a percent of sales increase, decrease, or remain unchanged over the 3-year period? Provide numerical support for your answer. Vertical Analysis 2018 2017 2016 Sales revenue 100.0% 100.0% 100.0% Cost of goods sold 60.0 63.9 65.0 Expenses 26.0 26.6 27.5arrow_forward
- Comparing Two Companies in the Same Industry: Chipotle and Panera Bread Refer to the financial information for Chipotle and Panera Bread reproduced at the back of the book and answer the following questions. What was the total revenue for each company for the most recent year? By what percentage did each companys revenue increase or decrease from its total amount in the prior year? What was each companys net income for the most recent year? By what percentage did each companys net income increase or decrease from its net income for the prior year? What was the total asset balance for each company at the end of its most recent year? Among its assets, what was the largest asset each company reported on its year-end balance sheet? Did either company pay its stockholders any dividends during the most recent year? Explain how you can tell.arrow_forwardComparing Two Companies in the Same Industry: Chipotle and Panera Bread Refer to the financial information for Chipotle and Panera Bread reproduced at the end of this book and answer the following questions: Required What is the dollar amount of inventories that each company reports on its balance sheet at the end of the most recent year? What percentage of total assets do inventories represent for each company? What does this tell you about the nature of their business? Refer to Note 1 in Chipotles annual report. What inventory valuation method does the company use? Refer to Note 2 in Panera Breads annual report. What inventory valuation method does the company use? How do both companies deal with situations in which the market value of inventory is less than its cost? Given the nature of their businesses, which inventory system, periodic or perpetual, would you expect both Chipotle and Panera Bread to use? Explain your answer.arrow_forwardRequired information Annie's Homemade Ice Cream provided the following data for this year: Sales Net operating income Average operating assets Required: Consider each question below Independently. Carry out all computations to two decimal places. $ 300,000 $ 54,000 $ 187,500 1. Compute the company's margin, turnover, and return on Investment (ROI) for this year. 2. The company is considering buying some billboard advertising with the expectation it would grow next year's sales and net operating Income by $50,000 and $20,000, respectively. If this plan is Implemented, what would become next year's margin, turnover, and ROI? 3. The company is considering buying a second cargo trailer and mobile cold plate push cart to expand its mobile sales. If the company Implements this plan, It expects next year's sales, net operating Income and average operating assets to Increase by $80,000, $30,000, and $10,000, respectively. What would become next year's margin, turnover, and ROI? Complete this…arrow_forward
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