The Home Depot reported the following data (in millions) in its financial statements for 2005 and 2004: 2005 2004 Net sales $73,094 $64,816 Total assets at the end of the year 38,907 34,437 Total assets at the beginning of the year 34,437 30,011 a. Determine the ratio of net sales to average total assets for The Home Depot for 2005 and 2004. Round to two decimal places. b. What conclusions can be drawn from these ratios concerning the trend in the ability of The Home Depot to effectively use its assets to generate sales?
The Home Depot reported the following data (in millions) in its financial statements for 2005 and 2004: 2005 2004 Net sales $73,094 $64,816 Total assets at the end of the year 38,907 34,437 Total assets at the beginning of the year 34,437 30,011 a. Determine the ratio of net sales to average total assets for The Home Depot for 2005 and 2004. Round to two decimal places. b. What conclusions can be drawn from these ratios concerning the trend in the ability of The Home Depot to effectively use its assets to generate sales?
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter15: Financial Statement Analysis
Section: Chapter Questions
Problem 51E: Juroe Company provided the following income statement for last year: Juroes balance sheet as of...
Related questions
Question
The Home Depot reported the following data (in millions) in its financial statements for 2005 and 2004:
|
|
2005 |
2004 |
|
Net sales |
$73,094 |
$64,816 |
|
Total assets at the end of the year |
38,907 |
34,437 |
|
Total assets at the beginning of the year |
34,437 |
30,011 |
a. Determine the ratio of net sales to average total assets for The Home Depot for 2005 and 2004. Round to two decimal places.
b. What conclusions can be drawn from these ratios concerning the trend in the ability of The Home Depot to effectively use its assets to generate sales?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 5 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub