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1.
Concept Introduction:
To calculate:the return on total assets for the current year for both the companies.
2.
Concept Introduction:
Return on assets/ investment is a profitability ratio that represents the percentage return on the investment made. It is calculated by dividing the Net Income by the Average total assets. The formulas to calculate the ROI are as follows:
To indicate:the company which has used its assets more efficiently in the current year.
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Chapter C Solutions
Gen Combo Ll Financial Accounting: Information For Decisions; Connect Ac
- Problem 1: Viance Queen Company Required: Compute for the company’s profitability and operating efficiency ratios for 2019 Compute for the financial health ratios of the company for 2019 A.Profitability ratio a.Gross Profit Ratio b. Operating income margin c. Net profit margin d. Return on Assets: ROA (NI/Total Assets) ROA (NI/Average Assets) ROA (EBIT/Total Assets) ROA (EBIT/Average Assets) ROE (NI/Capital) ROE (NI/Average Capital B.Operating Efficiency a. Asset Turnover b. Fixed Asset Turnover c. Inventory Turnover d. Days in Inventory e. AR Turnover f. Days in AR C.Financial Health/ (Solvency and Liquidity) Solvency ratio: a. Debt to equity ratio b. Debt Ratio c. Equity Ratio d. Interest Coverage Ratio Liquidity ratio: a. Current Ratio b. Quick Ratioarrow_forwardCompute the net income of the year for Company B.arrow_forwardThe company’s profitability on each dollar invested in assets is represented by which of the following ratios: a. Profit margin. b. Asset turnover. c. Return on assets. d. Return on equity.arrow_forward
- Problem 1: Viance Queen Company Required: Compute for the company’s profitability and operating efficiency ratios for 2019 Compute for the financial health ratios of the company for 2019 A.Profitability ratio Return on Assets: ROA (EBIT/Average Assets) ROE (NI/Capital) ROE (NI/Average Capitalarrow_forwardList the amount of Current Assets and Current Liabilities for the currently reported year, and for the previous year. Use these amounts to calculate the company's working capital and current ratio.arrow_forwardThe following information is taken from the records of Baklava Bakery for the year 2019. A. Calculate net income or net loss for January. B. Calculate net income or net loss for February. C. Calculate net income or net loss for March. D. For each situation, comment on how a stakeholder might view the firms performance. (Hint: Think about the source of the income or loss.)arrow_forward
- see attached 1-3 and 1-5 to answer this Refer to the financial statements of Mixon Company in Exercises 1–3 and 1–5. Evaluate the effi- ciency and profitability of the company by computing the following: (a) net profit margin, (b) total asset turnover, and (c) return on total assets. Comment on these ratio results.arrow_forwardGiven the following information for Smashville, Inc., construct an income statement for the year: What are retained earnings for the year?arrow_forwardfirst discuss the use of the income statement, in general, for decision-making. Then, calculate the net operating income and operating margin for this year and last year using the table information below and discuss what these figures mean for the company (i.e. what ‘story’ do they tell the reader). ..arrow_forward
- PROBLEM 11-17 Return on Investment (ROI) and Residual Income LO11-1, LO11-2 Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Ending Balance Balance Assets Cash $ 140,000 $ 120,000 Accounts receivable 450,000 530,000 Inventory 320,000 380,000 Plant and equipment, net 680,000 620,000 Investment in Buisson, S.A. 280,000 170,000 250,000 Land (undeveloped) 180,000 Total assets $2,020,000 $2,100,000 Liabilities and Stockholders' Equity Accounts payable. $ 360,000 $ 310,000 Long-term debt Stockholders' equity 1,500,000 1,500,000 160,000 290,000 Total liabilities and stockholders' equity $2,020,000 $2,100,000 Joel de Paris, Inc. Income Statement Sales $4,050,000 Operating expenses Net operating income 3,645,000 405,000 Interest and taxes: Interest expense $150,000 Таx expense 110,000 260,000 Net income $ 145,000 The company paid dividends of $15,000 last year. The "Investment in Buisson, S.A.," on the balance sheet represents an…arrow_forwardQ6) Which of the following best suits this description: “It is a summary of the net assets and worth of the firm at the end of the year”? Group of answer choices a) Economic Value Added. b) Balance Sheet. c) Cash Flow Statement. d) Income Statement.arrow_forwardReturn on total assets; a company reports the following income statement and balance sheet information for the current year: net income $178,320 interest expense $31,470 average total assets $3,330,000. A. Determine the return of total assets. B. Determine the company's price- earnings ratio.arrow_forward
- Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax CollegeSurvey of Accounting (Accounting I)AccountingISBN:9781305961883Author:Carl WarrenPublisher:Cengage Learning
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