Accounting (Text Only)
26th Edition
ISBN: 9781285743615
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 17, Problem 17.16EX
a)
To determine
Financial Ratios: Financial ratios are the metrics used to evaluate the liquidity, capabilities, profitability, and overall performance of a company.
To compute: Asset turnover ratio for all three companies
Given info: Sales and average total assets
b)
To determine
To interpret: The differences in asset turnover.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
[The following information applies to the questions displayed below.] Summary information from the financial statements of two companies competing in the same industry follows.
BarcoCompany
KyanCompany
BarcoCompany
KyanCompany
Data from the current year-end balance sheets
Data from the current year’s income statement
Assets
Sales
$
770,000
$
914,200
Cash
$
21,000
$
34,000
Cost of goods sold
587,100
642,500
Accounts receivable, net
34,400
59,400
Interest expense
9,100
17,000
Merchandise inventory
84,940
132,500
Income tax expense
14,800
25,238
Prepaid expenses
5,400
7,350
Net income
159,000
229,462
Plant assets, net
310,000
307,400
Basic earnings per share
3.79
5.08
Total assets
$
455,740
$
540,650
Cash dividends per share
3.82
4.01
Liabilities and Equity
Beginning-of-year balance sheet data
Current…
The following information applies to the questions displayed below.] Summary information from the financial statements of two companies competing in the same industry follows.
BarcoCompany
KyanCompany
BarcoCompany
KyanCompany
Data from the current year-end balance sheets
Data from the current year’s income statement
Assets
Sales
$
770,000
$
914,200
Cash
$
21,000
$
34,000
Cost of goods sold
587,100
642,500
Accounts receivable, net
34,400
59,400
Interest expense
9,100
17,000
Merchandise inventory
84,940
132,500
Income tax expense
14,800
25,238
Prepaid expenses
5,400
7,350
Net income
159,000
229,462
Plant assets, net
310,000
307,400
Basic earnings per share
3.79
5.08
Total assets
$
455,740
$
540,650
Cash dividends per share
3.82
4.01
Liabilities and Equity
Beginning-of-year balance sheet data
Current…
Three major segments of the transportation industry are motor carriers such as Atlantic Worldwide, railroads such as Pacific, and transportation logistics services such as Mediterranean. Recent financial statement information for these three companies follows (in thousands):
Atlantic
Pacific
Mediterranean
Sales
$1,602,930
$892,080
$2,142,260
Average total assets
763,300
1,274,400
498,200
a. Determine the asset turnover for all three companies. Round your answers to two decimal places.
Atlantic
fill in the blank 1
Pacific
fill in the blank 2
Mediterranean
fill in the blank 3
Chapter 17 Solutions
Accounting (Text Only)
Ch. 17 - Prob. 1DQCh. 17 - Prob. 2DQCh. 17 - Prob. 3DQCh. 17 - How would the current and quick ratios of a...Ch. 17 - a. Why is it advantageous to have a high inventory...Ch. 17 - What do the following data, taken from a...Ch. 17 - a. How does the rate earned on total assets differ...Ch. 17 - Kroger, a grocery store, recently had a...Ch. 17 - Prob. 9DQCh. 17 - Prob. 10DQ
Ch. 17 - Horizontal analysis The comparative temporary...Ch. 17 - Prob. 17.1BPECh. 17 - Vertical analysis Income statement information for...Ch. 17 - Vertical analysis Income statement information for...Ch. 17 - Prob. 17.3APECh. 17 - Prob. 17.3BPECh. 17 - Accounts receivable analysis A company reports the...Ch. 17 - Accounts receivable analysis A company reports the...Ch. 17 - Inventory analysis A company reports the...Ch. 17 - Inventory analysis A company reports the...Ch. 17 - Prob. 17.6APECh. 17 - Prob. 17.6BPECh. 17 - Times interest earned A company reports the...Ch. 17 - Times interest earned A company reports the...Ch. 17 - Asset turnover A company reports the following:...Ch. 17 - Asset turnover A company reports the following:...Ch. 17 - Return on total assets A company reports the...Ch. 17 - Return on total assets A company reports the...Ch. 17 - Common stockholders profitability analysis A...Ch. 17 - Common stockholders profitability analysis A...Ch. 17 - Prob. 17.11APECh. 17 - Prob. 17.11BPECh. 17 - Prob. 17.1EXCh. 17 - Vertical analysis of income statement The...Ch. 17 - Common-sized income statement Revenue and expense...Ch. 17 - Vertical analysis of balance sheet Balance sheet...Ch. 17 - Prob. 17.5EXCh. 17 - Prob. 17.6EXCh. 17 - Prob. 17.7EXCh. 17 - Prob. 17.8EXCh. 17 - Accounts receivable analysis The following data...Ch. 17 - Accounts receivable analysis Xavier Scores Company...Ch. 17 - Inventory analysis The following data were...Ch. 17 - Prob. 17.12EXCh. 17 - Ratio of liabilities to stockholders equity and...Ch. 17 - Ratio of liabilities to stockholders equity and...Ch. 17 - Ratio of liabilities to stockholders equity and...Ch. 17 - Prob. 17.16EXCh. 17 - Profitability ratios The following selected data...Ch. 17 - Profitability ratios Ralph Lauren Corporation...Ch. 17 - Six measures of solvency or profitability The...Ch. 17 - Six measures of solvency or profitability The...Ch. 17 - Prob. 17.21EXCh. 17 - Prob. 17.22EXCh. 17 - Earnings per share, discontinued operations The...Ch. 17 - Prob. 17.24EXCh. 17 - Prob. 17.25EXCh. 17 - Prob. 17.26EXCh. 17 - Horizontal analysis of income statement For 2016,...Ch. 17 - Prob. 17.2APRCh. 17 - Prob. 17.3APRCh. 17 - Nineteen measures of solvency and profitability...Ch. 17 - Prob. 17.5APRCh. 17 - Prob. 17.1BPRCh. 17 - Prob. 17.2BPRCh. 17 - Effect of transactions on current position...Ch. 17 - Nineteen measures of solvency and profitability...Ch. 17 - Solvency and profitability trend analysis Crosby...Ch. 17 - Nike, Inc., Problem Financial Statement Analysis...Ch. 17 - Prob. 17.1CPCh. 17 - Prob. 17.2CPCh. 17 - Vertical analysis The condensed income statements...Ch. 17 - Prob. 17.4CPCh. 17 - Comprehensive profitability and solvency analysis...
Knowledge Booster
Similar questions
- Return on assets The financial statements of The Hershey Company (HSY) are shown in Exhibits 6 through 9 of this chapter. Based upon these statements, answer the following questions. The percent that a company adds to its cost of sales to determine the selling price is called a markup. That is Hershey’s markup percent? Round to one decimal place.arrow_forwardAsset Efficiency Ratios Selected financial statement numbers for Rutherford Company follow. Required: 1. Using this information, calculate Rutherfords receivable turnover ratio (rounded to two decimal places.) 2. Using this information, calculate Rutherfords asset turnover ratio (rounded to two decimal places) and also convert the ratio into days (rounded to the nearest whole day).arrow_forwardReturn on assets The following data (in millions) were adapted from recent financial statements of Tootsie Roll Industries Inc. (TR): What is Tootsie Roll’s percent of the cost of sales to sales? Round to one decimal place.arrow_forward
- Return on assets The following data (in millions) were adapted from recent financial statements of Tootsie Roll Industries Inc. (TR): The percent a company adds to its cost of sales to determine selling price is called a markup. What is Tootsie Roll’s markup percent? Round to one decimal place.arrow_forwardSummary information from the financial statements of two companies competing in the same industry follows. BarcoCompany KyanCompany BarcoCompany KyanCompany Data from the current year-end balance sheets Data from the current year’s income statement Assets Sales $ 800,000 $ 926,200 Cash $ 18,500 $ 31,000 Cost of goods sold 595,100 638,500 Accounts receivable, net 37,400 55,400 Interest expense 9,200 10,000 Merchandise inventory 84,740 136,500 Income tax expense 15,377 25,570 Prepaid expenses 6,000 7,700 Net income 180,323 252,130 Plant assets, net 350,000 307,400 Basic earnings per share 4.75 5.84 Total assets $ 496,640 $ 538,000 Cash dividends per share 3.81 3.98 Liabilities and Equity Beginning-of-year balance sheet data Current liabilities $ 62,340 $ 94,300 Accounts receivable, net $ 31,800 $…arrow_forwardThree major segments of the transportation industry are motor carriers, such as Atlantic; railroads, such as Pacific; and transportation arrangement services, such as Mediterranean. Recent financial statement information for these three companies is shown as follows (in thousands of dollars): Atlantic Pacific Mediterranean Sales $3,736,923 $4,993,352 $1,909,372 Average total assets 795,090 1,314,040 561,580 a. Determine the asset turnover for all three companies. Round to one decimal place. Atlantic fill in the blank 1 Pacific fill in the blank 2 Mediterranean fill in the blank 3 b. The ratio of sales to assets measures the number of sales dollars earned for each dollar of assets. The greater the number of sales dollars earned for every dollar of assets, the efficient a firm is in using assets.arrow_forward
- Three major segments of the transportation industry are motor carriers such as YRC Worldwide, railroads such as Union Pacific, and transportation logistics services such as C.H. Robinson Worldwide, Inc. Recent financial statement information for these three companies follows (in thousands): YRC Union Pacific C.H. Robinson Sales $5,092,000 $22,832,000 $16,631,172 Average total assets 1,601,300 58,476,500 4,331,623 a. Determine the asset turnover for all three companies. Round your answers to one decimal place. YRC fill in the blank 1 Union Pacific fill in the blank 2 C.H. Robinson fill in the blank 3 b. The ratio of sales to assets measures the number of sales dollars earned for each dollar of assets. The greater the number of sales dollars earned for every dollar of assets, the efficient a firm is in using assets.arrow_forwardThree major transportation segments and a major company within each segment are as follows: Segment Company Motor carriers YRC Worldwide Inc. (YRCW) Railroads Union Pacific Corporation (UNP) Transportation Arrangement C.H. Robinson Worldwide Inc. (CHRW) YRC Worldwide Union Pacific C.H. RobinsonWorldwide Sales $4,832 $21,813 $13,470 Average long-term operating assets 1,016 47,569 1,092 a. Determine the asset turnover for all three companies. Round to two decimal places. YRC Worldwide ???? Union Pacific ???? C.H. Robinson Worldwide ????arrow_forwardReturn on assets The financial statements of The Hershey Company (HSY) are shown in Exhibits 6 through 9. Based upon these statements, answer the following questions. 1. What are Hershey's sales (in millions)? 2. What is Hershey's cost of sales (in millions)? 3. What is Hershey's net income (in millions)? 4. What is Hershey's percent of the cost of the sales to sales? Round to one decimal place. 5. The percent that a company adds to its cost of sales to determine the selling price is called a markup. What is Hershey's markup percent? Round to one decimal place. 6. What is the percentage of net income to sales for Hershey? Round to one decimal place. 7. Hershey had total assets of $5,554 (millions) at the beginning of the year. Compute the return on assets for Hershey for the year shown in Exhibits 6–9. Round to one decimal place.arrow_forward
- Summary information from the financial statements of two companies competing in the same industry follows. Barco Company Kyan Company Barco Company Kyan Company Data from the current year-end balance sheets Data from the current year’s income statement Assets Sales $ 770,000 $ 895,200 Cash $ 18,500 $ 33,000 Cost of goods sold 593,100 642,500 Accounts receivable, net 40,400 51,400 Interest expense 8,300 16,000 Merchandise inventory 84,940 128,500 Income tax expense 14,800 24,714 Prepaid expenses 5,500 7,550 Net income 153,800 211,986 Plant assets, net 310,000 312,400 Basic earnings per share 4.52 4.91 Total assets $ 459,340 $ 532,850 Cash dividends per share 3.74 3.92 Liabilities and Equity Beginning-of-year balance sheet data Current liabilities $ 64,340 $ 98,300 Accounts receivable, net $ 30,800 $ 51,200 Long-term notes payable 79,800 109,000 Merchandise inventory 63,600 105,400 Common stock, $5 par value 170,000 216,000 Total assets…arrow_forwardSummary information from the financial statements of two companies competing in the same industry follows. Barco Company Kyan Company Barco Company Kyan Company Data from the current year-end balance sheets Data from the current year’s income statement Assets Sales $ 760,000 $ 914,200 Cash $ 21,500 $ 37,000 Cost of goods sold 593,100 636,500 Accounts receivable, net 37,400 54,400 Interest expense 8,000 12,000 Merchandise inventory 84,640 138,500 Income tax expense 14,608 25,238 Prepaid expenses 5,400 7,450 Net income 144,292 240,462 Plant assets, net 290,000 306,400 Basic earnings per share 4.24 5.57 Total assets $ 438,940 $ 543,750 Cash dividends per share 3.72 3.95 Liabilities and Equity Beginning-of-year balance sheet data Current liabilities $ 67,340 $ 97,300 Accounts receivable, net $ 26,800 $ 54,200 Long-term notes payable 85,800 107,000 Merchandise inventory 57,600 107,400 Common stock, $5 par value 170,000 216,000 Total assets…arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Financial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
Financial & Managerial AccountingAccountingISBN:9781337119207Author:Carl Warren, James M. Reeve, Jonathan DuchacPublisher:Cengage Learning
Corporate Financial AccountingAccountingISBN:9781305653535Author:Carl Warren, James M. Reeve, Jonathan DuchacPublisher:Cengage Learning
Survey of Accounting (Accounting I)AccountingISBN:9781305961883Author:Carl WarrenPublisher:Cengage Learning
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
Financial & Managerial Accounting
Accounting
ISBN:9781337119207
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Cengage Learning
Corporate Financial Accounting
Accounting
ISBN:9781305653535
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Cengage Learning
Survey of Accounting (Accounting I)
Accounting
ISBN:9781305961883
Author:Carl Warren
Publisher:Cengage Learning