HORNGREN'S FINANCIAL & MANAGERIAL ACCO
16th Edition
ISBN: 9781323425084
Author: MILLER-NOBLES
Publisher: PEARSON C
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Textbook Question
Chapter 10, Problem 10.7SE
Computing
Kabra's 2016 financial statements reported the following items-with 2015 figures given for comparison:
Net income for 2016 was $4,020, and interest expense was $160. Compute Kabra's rate of return on total assets for 2016.(Round to the nearest percent.)
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Computing rate of return on total assets
Barot’s 2018 financial statements reported the following items—with 2017 figures given for comparison:
Net income for 2018 was $3,910, and interest expense was $240. Compute Barot’s rate of return on total assets for 2018. (Round to the nearest percent.)
The 2017 annual report of Tootsie Roll Industries contains the following information.
(in millions)
December 31, 2017
0000
December 31, 2016
Total assets
$930.9
$920.1
Total liabilities
197.1
208.6
Net sales
515.7
517.4
Net income
80.7
67.2
Instructions
Compute the following ratios for Tootsie Roll for 2017.
a. Asset turnover.
b. Return on assets.
c. Profit margin on sales.
d. How can the asset turnover be used to compute the return on assets?
Calculate each of following ratios for year 2017 using the financial statement in Table 1-3.
Total Asset turnover
Fixed asset turnover
Liquidity Ratio
Current ratio
Quick ratio
Liability to assets
Interest coverage ratio
Profitability Ratios
ROA
ROE
Gross profit margin
Operating profit margin
Net operating profit margin
Table 1: Balance Sheet Statement for 2017
Cash $7,282
Short-Term invest. 20,000
Accounts Receivable 632,160
Inventories 1,287,360
Total Current Assets 1,946,802
Gross Property, Plant & Equipment 1,202,950
Less: Depreciation 263,160
Net Property, Plant & Equipment 939,790
Total assets $2,886,592
Accounts payable $324,000
Notes payable 720,000
Accruals 284,960
Total Current Liability 1,328,960
Long-term debt 1,000,000
Common stock 460,000
Retained earnings 97,632
Total equity 557,632
Total Liability & Equity $2,886,592
Table 2:
Income Statement for 2017
Sales $5,834,400
COGS 4,980,000
Depreciation 116,960
Other expenses…
Chapter 10 Solutions
HORNGREN'S FINANCIAL & MANAGERIAL ACCO
Ch. 10 - Prob. 1QCCh. 10 - Which of the following investments is most likely...Ch. 10 - If Intervale Railway invests 100,000 in 5% bonds...Ch. 10 - Prob. 4QCCh. 10 - Prob. 5QCCh. 10 - Prob. 6QCCh. 10 - Prob. 7QCCh. 10 - Harvard Co. purchased a trading investment on...Ch. 10 - Prob. 9QCCh. 10 - Prob. 10QC
Ch. 10 - What is a debt security?Ch. 10 - Prob. 2RQCh. 10 - Prob. 3RQCh. 10 - Briefly describe the five specific types of debt...Ch. 10 - How is the purchase of a held-to-maturity debt...Ch. 10 - Prob. 6RQCh. 10 - What method is used for investments in equity...Ch. 10 - What method is used for investments in equity...Ch. 10 - What adjustment must be made at the end of the...Ch. 10 - Where on the financial statements is an unrealized...Ch. 10 - Prob. 11RQCh. 10 - Prob. 12RQCh. 10 - Prob. 13RQCh. 10 - What does the rate of return on total assets...Ch. 10 - Identifying why companies invest and classifying...Ch. 10 - Prob. 10.2SECh. 10 - Prob. 10.3SECh. 10 - Accounting for equity method On January 1, 2016,...Ch. 10 - Accounting for trading investments On February 1,...Ch. 10 - Prob. 10.6SECh. 10 - Computing rate of return on total assets Kabra's...Ch. 10 - Prob. 10.8ECh. 10 - Prob. 10.9ECh. 10 - Accounting for bond investments Otter Creek Co....Ch. 10 - Accounting for stock investments Dollar Bill...Ch. 10 - Prob. 10.12ECh. 10 - Prob. 10.13ECh. 10 - Accounting for stock investments Suppose that on...Ch. 10 - Prob. 10.15ECh. 10 - Prob. 10.16ECh. 10 - A Accounting for bond investments Suppose Jenner...Ch. 10 - Prob. 10.18APCh. 10 - Accounting for stock investments The beginning...Ch. 10 - Accounting for bond investments Suppose Ritter...Ch. 10 - Classifying and accounting for stock investments...Ch. 10 - Accounting for stock investments The beginning...Ch. 10 - Prob. 10.23CPCh. 10 - Prob. 10.1CTEICh. 10 - Wild Adventure conducts tours of wildlife reserves...Ch. 10 - Prob. 10.1CTFSCCh. 10 - Prob. 10.1CTTPCh. 10 - In 150 words or fewer, explain the difference...
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