2 Semester Cengage Now, Warren Accounting
26th Edition
ISBN: 9781305662308
Author: WARREN
Publisher: Cengage
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Chapter 10, Problem 10.9BPE
a)
To determine
Fixed Asset turnover:
It is a ratio that measures the productive capacity of the fixed assets to generate the sales revenue for the company. Thus, it shows the relationship between the net sales and the average total fixed assets. The following is the formula to calculate the ratio:
The fixed asset Turnover Ratio of Company D for 2015 and 2016.
b)
To determine
To explain: whether the change in the fixed asset turnover ratio from 2015 to 2016 indicates a favorable or unfavorable change.
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Comment on the changes between these two years. More specifically, how do the changes in total asset turnover TATO ratio between 2017 and 2016 reflect changes in asset utilization efficiency and, other things equal, shareholder value
Fixed asset turnover ratio :
2015: 7.48x
2016: 6.14x
2017: 7.70x
2018: 4.59x
2019: 6.38x
What is the trend analysis from 2015 to 2019 for the Fixed Asset Turnover Ratio and why the ratio is decrease and increase?
What is the comparison (analysis) of the Fixed Asset Turnover Ratio of Industry Average Ratio and the Company A Ratio? The Fixed Asset Turnover Ratio has decreased and increased. Why?
Industry Average Fixed Asset Turnover Ratio
2015: 3.00
2016: 3.18
2017: 3.58
2018: 2.23
2019: 2.94
Company A Fixed Asset Turnover Ratio
2015: 7.48
2016: 6.14
2017: 7.70
2018: 4.59
2019: 6.38
Chapter 10 Solutions
2 Semester Cengage Now, Warren Accounting
Ch. 10 - ONeil Office Supplies has a fleet of automobiles...Ch. 10 - Prob. 2DQCh. 10 - Prob. 3DQCh. 10 - Prob. 4DQCh. 10 - Immediately after a used truck is acquired, a new...Ch. 10 - Keyser Company purchased a machine that has a...Ch. 10 - Is it necessary for a business to use the same...Ch. 10 - Prob. 8DQCh. 10 - For some of the fixed assets of a business, the...Ch. 10 - a. Over what period of time should the cost of a...
Ch. 10 - Straight-line depreciation A building acquired at...Ch. 10 - Straight-line depreciation Equipment acquired at...Ch. 10 - Units-of-activity depreciation A truck acquired at...Ch. 10 - Units-of-activity depreciation A tractor acquired...Ch. 10 - Double declining-balance depreciation A building...Ch. 10 - Double-declining-balance depreciation Equipment...Ch. 10 - Revision of depreciation Equipment with a cost of...Ch. 10 - Revision of depreciation A truck with a cost of...Ch. 10 - Capital and revenue expenditures On February 14,...Ch. 10 - Capital and revenue expenditures On August 7,...Ch. 10 - Sale of equipment Equipment was acquired at the...Ch. 10 - Sale of equipment Equipment was acquired at the...Ch. 10 - Prob. 10.7BPECh. 10 - Prob. 10.7APECh. 10 - Prob. 10.8BPECh. 10 - Prob. 10.8APECh. 10 - Prob. 10.9APECh. 10 - Prob. 10.9BPECh. 10 - Costs of acquiring fixed assets Melinda Stoffers...Ch. 10 - Prob. 10.2EXCh. 10 - Determining cost of land Northwest Delivery...Ch. 10 - Prob. 10.4EXCh. 10 - Prob. 10.5EXCh. 10 - Capital and revenue expenditures Quality Move...Ch. 10 - Nature of depreciation Tri-City Ironworks Co....Ch. 10 - Prob. 10.8EXCh. 10 - Prob. 10.9EXCh. 10 - Prob. 10.10EXCh. 10 - Depreciation by units-of-output method Prior to...Ch. 10 - Depreciation by two methods A John Deere tractor...Ch. 10 - Depreciation by two methods A storage tank...Ch. 10 - Partial-year depreciation Sandblasting equipment...Ch. 10 - Revision of depreciation A building with a cost of...Ch. 10 - Capital expenditure and depreciation; parital-year...Ch. 10 - Entries for sale of fixed asset Equipment acquired...Ch. 10 - Prob. 10.18EXCh. 10 - Depletion entries Big Sky Mining Co. acquired...Ch. 10 - Prob. 10.20EXCh. 10 - Book value of fixed assets Apple Inc. designs,...Ch. 10 - Balance sheet presentation List the errors you...Ch. 10 - Prob. 10.24EXCh. 10 - Prob. 10.23EXCh. 10 - Asset traded for similar asset A printing press...Ch. 10 - Prob. 10.26EXCh. 10 - Entries for trade of fixed asset On July 1, Twin...Ch. 10 - Entries for trade of fixed asset On October 1,...Ch. 10 - Allocating payments and receipts to fixed asset...Ch. 10 - Comparing three depreciation methods Montes Coffee...Ch. 10 - Depreciation by three methods; partial years...Ch. 10 - Prob. 10.4APRCh. 10 - Transactions for fixed assets, including sale The...Ch. 10 - Amortization and depletion entries Data related to...Ch. 10 - Allocating payments and receipts to fixed asset...Ch. 10 - Comparing three depreciation methods Waylander...Ch. 10 - Depreciation by three methods; partial years...Ch. 10 - Depreciation by two methods; sale of fixed asset...Ch. 10 - Transactions for fixed assets, including sale The...Ch. 10 - Amortization and depletion entries Data related to...Ch. 10 - Prob. 10.1CPCh. 10 - Prob. 10.2CPCh. 10 - Effect of depreciation on net income Tuttle...Ch. 10 - Fixed asset turnover: three industries The...
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- Fixed asset turnover ratio : 2015: 7.48x 2016: 6.14x 2017: 7.70x 2018: 4.59x 2019: 6.38x What is the trend analysis from 2015 to 2019arrow_forwardWhat is D’Leon’s Forecasted Current Ratio for 2016? What is D’Leon’s Forecasted Quick Ratio for 2016? What is D’Leon’s Inventory Turnover ratio for 2016? What is D’Leon’s DSO for 2016? What is D’Leon’s Fixed Asset turnover for 2016? What is D’Leon’s Total Asset turnover for 2016? What is D’Leon’s Debt-to-capital ratio for 2016? Answer in percentage form (Ex: if your formula gives you .28467 you would answer 28.47 without the "%"). What is D’Leon’s Times-interest earned ratio for 2016?arrow_forwardWhat is the comparison of TOTAL ASSET TURNOVER between Alex Company and the industry Average? Which one is better in terms of performance? Industry Average (Total Asset Turnover) 2015: 0.70 2016: 0.68 2017: 0.46 2018: 1.36 2019: 1.42 Alex company (Total Asset Turnover) 2015: 0.15 2016: 0.14 2017: 0.20 2018: 0.14 2019: 0.22arrow_forward
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