Chapter 14, Problem 9E

Financial Ratios for Assessing Profitability and Managing
Refer to the financial statements for Castile Products, inc., in Exercise 14-8. Assets at the beginning of the year totaled $280,000, and the stockholders’ equity totaled $161,600.
Required:
Compute the following:
1. Gross margin percentage.
2. Net profit margin percentage,
3. Return on total assets.
4. Return on equity.
S. Was financial leverage positive or negative for the year? Explain.