1.
Introduction: Return on asset shows the efficiency of the managers to utilize the assets of the company to have good returns on it. It helps to understand the company’s position in the market.
The return on assets of company S for (a) the current year and (b) previous year.
2.
Introduction: Return on asset shows the efficiency of the managers to utilise the assets of the company to have good returns on it. It helps to understand the company’s position in the market.
The trend of return on assets of Company S.
3.
Introduction: Return on asset shows the efficiency of the managers to utilise the assets of the company to have good returns on it. It helps to understand the company’s position in the market.
The trend of return on assets of Company S compared with (a) Company A and (b) Company G.
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FINANCIAL ACCT.FUNDAMENTALS <CUSTOM LL>
- The Board of Directors were worried over the dwindling financial performance and precarious financial position of the Company. The company products were ageing; the economic depression biting harder as a result of the fluctuating exchange rate due to Brexit. The Company imports 60% of the goods sold in Garden City. The fluctuating exchange rate had affected the company’s importation. Consequently, the revenue of the Company dropped significantly. You are required to: A) Calculate the following ratios for the year ended September 30, 2015 and 2016 in Columnar form: iv) Debt Equity Ratio v)Fixed Interest cover vi)Earnings Yield vii) Price Earnings Ratio Viii) Dividend Yieldarrow_forwardStaples, Inc. is one of the largest suppliers of office products in the United States. Suppose it had net income of $790 million and sales of $23,900 million in 2022. Its total assets were $14,500 million at the beginning of the year and $15,650 million at the end of the year. What is Staples, Inc.’s (a) asset turnover and (b) profit margin? (Round answers to 2 decimal places, e.g. 1.25.) (a) Asset turnover enter asset turnover in times rounded to 2 decimal places times (b) Profit margin Enter profit margin in percentages rounded to 1 decimal place %arrow_forwardAT&T and Verizon produce and market telecommunications products and are competitors. Key financial figures for these businesses for a recent year follow. Which company is more successful in returning net income from its assets invested?arrow_forward
- Certain financial ratios for The Gap for its most recent year are given below, along with the average ratios for its industry. Based on those ratios, answer the following. 1) Does The Gap seem to prefer to finance its assets with debt or with equity? How can you tell? What percent of its assets are funded with debt? What percent of its assets are funded with equity? 2) A supplier to The Gap sells merchandise to The Gap and asks to be paid within 60 days. While any of The Gap’s financial ratios might be of interest to the supplier, which of the ratios listed below do you think would likely be the most important one to the supplier? Why? 3) Which of the ratios presented suggest that, compared to its industry, The Gap may have a problem controlling its operating expenses? How can you tell? Your answer should clearly indicate that you understand why the ratio that you chose answers this question. Here is the data for The Gap and its industry. Financial Ratios…arrow_forwardThe Table also provides financial indicators for the chemical and related products industry (Chemicals and Allied Products) for the year 2018. This will allow you to compare the performance of both firms J & J and Merck with the industry in which they compete for the same year. Do you understand that the performance of firms is superior to the average performance of their competitors in the market? Justify your answer. What adjustments or changes would you recommend to make each of the firms more attractive to shareholders and others interested in them? Justify your answer. Company Name: Year 2018 Chemicals and Allied Products Industry Ratios ………….. Solvency or Debt Ratios Merck J&J 2018 Debt ratio 0.67 0.61 0.47 Debt-to-equity ratio 0.93 0.51 0.38 Interest coverage ratio 12.27 18.91 -9.43 Liquidity Ratios Current ratio 1.17 1.47 3.47 Quick ratio 0.92 1.16 2.12 Cash…arrow_forwardGregg’s Shipping Supplies Ltd (GSSL) trades in the buying and selling of ship spares and has several branches within the Caribbean. Recently the company has seen a rapid increase in demand of its products across all branches and is therefore in need of additional financing to adequately boost its supply inventory. The corporate banking head of Bankers Choice Bank is requesting a full set of financial statements to ensure that granting the loan to GSSL would be financially feasible during a period when many businesses are facing financial challenges. The company financial year ends on June 30 each year and you have been tasked with the responsibility to prepare the financial information for the St. Kitts branch. 1. Prepare the Adjusted Trial balance at June 30, 2022.arrow_forward
- Gregg’s Shipping Supplies Ltd (GSSL) trades in the buying and selling of ship spares and has several branches within the Caribbean. Recently the company has seen a rapid increase in demand of its products across all branches and is therefore in need of additional financing to adequately boost its supply inventory. The corporate banking head of Bankers Choice Bank is requesting a full set of financial statements to ensure that granting the loan to GSSL would be financially feasible during a period when many businesses are facing financial challenges. The company financial year ends on June 30 each year and you have been tasked with the responsibility to prepare the financial information for the branch that is linked to your first name initial. Trinidad Branch Required:a) Prepare the necessary adjusting journal entries on June 30, 2022 b) Prepare the Adjusted Trial balance at June 30, 2022. c) Prepare the company’s multiple-step income statement for the period ending June 30, 2022 d)…arrow_forwardbased on the ratio analysis below will the company be successful after taking a 500.0 mil loan to regain the lead in the construction market and to expand its business to the sale of heavy equipment? or should the company sought other forms of financing? Analysis of Financial Data (Table with ratios) Ratio Analysis 2021 Est. 2020 2019 Industry Average Liquidity Ratios Current Ratio (times) 2.34 3.22 3.68 4.2 Quick Ratio (times) 0.91 1.24 1.79 2.1 Asset Management Ratios Average sales/day 10.96 8.22 7.81 9 Inventory Turnover Ratio (times) 6.08 5.83 5.06 9 Days Sales Outstanding (days) 38.32 45.62 40.34 36 Fixed Assets Turnover Ratio (times) 2.12 2.52 3.27 3 Total Asset Turnover Ratio 1.32 1.37 1.69 1.8 Debt Management Ratios Total Debt to Total Assets (%) 59.09…arrow_forwardWhich of the following is not a potential problem caused by differences in financial reporting practices across countries?a. Consolidation of financial statements by firms with foreign operations is more difficult.b. Firms incur additional costs when attempting to obtain financing in foreign countries.c. Firms face double taxation on income earned by foreign operations.d. Comparisons of financial ratios across firms in different countries may not be meaningful.arrow_forward
- BMW, owner of the BMW, Mini, and Rolls-Royce brands, has been a major presence in Europe since 1916. The company still sells 46 percent of its cars in Europe, and growth is highest there. However, China is becoming one of BMW’s most important markets. In 2016, the company sold over 520,000 cars in China, and BMW has turned to the Chinese market as a primary focus for future sales. Despite rising sales revenues, BMW is conscious that its profits are often wiped out by changes in exchange rates. The company has pointed out that it was hit particularly hard by China’s currency devaluation in late 2015. BMW Brilliance Automotive Co. Ltd., BMW’s subsidiary in China, imports about half its components from Europe and elsewhere, and it faced major declines in profit because of the negative effects of unfavorable exchange rates. However, BMW did not want to pass those exchange rate costs on to consumers through price increases. Its rival, Porsche, had done that in the United States at the end…arrow_forwardBMW, owner of the BMW, Mini, and Rolls-Royce brands, has been a major presence in Europe since 1916. The company still sells 46 percent of its cars in Europe, and growth is highest there. However, China is becoming one of BMW’s most important markets. In 2016, the company sold over 520,000 cars in China, and BMW has turned to the Chinese market as a primary focus for future sales. Despite rising sales revenues, BMW is conscious that its profits are often wiped out by changes in exchange rates. The company has pointed out that it was hit particularly hard by China’s currency devaluation in late 2015. BMW Brilliance Automotive Co. Ltd., BMW’s subsidiary in China, imports about half its components from Europe and elsewhere, and it faced major declines in profit because of the negative effects of unfavorable exchange rates. However, BMW did not want to pass those exchange rate costs on to consumers through price increases. Its rival, Porsche, had done that in the United States at the end…arrow_forwardPlant Universe Ltd (PUL) trades in the buying and selling of flowers and has several branches within your country. Recently the company has seen a rapid increase in demand of its products across all branches and is therefore in need of additional financing to adequately boost its inventory. The corporate banking head of Bank One Ltd is requesting a full set of financial statements to ensure that granting the loan to PUL would be financially feasible during a period when many businesses are facing financial challenges.arrow_forward
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