Business, 21.11.2019 06:31 Answers4833
Win's companies, a home improvement store chain, reported the following summarized figures:
win's companies
income statement
years ended may 31, 2016 and 2015
2016
2015
net sales
$51,200,000
$38,800,000
cost of goods sold
28,400,000
28,600,000
interest expense
500,000
280,000
all other expenses
6,700,000
7,100,000
net income
$15,600,000
$2,820,000
win's companies
balance sheet
may 31, 2016 and 2015
assets
liabilities
2016
2015
2016
2015
cash
$2,400,000
$1,700,000
total current liabilities
$28,000,000
$13,300,000
short-term investments
27,000,000
11,000,000
long-term liabilities
13,200,000
11,400,000
accounts receivable
7,300,000
5,700,000
total liabilities
41,200,000
24,700,000
merchandise inventory
7,300,000
9,700,000
stockholders' equity
other current assets
6,000,000
2,500,000
common stock
11,000,000
11,000,000
total current assets
50,000,000
30,600,000
retained earnings
25,800,000
20,900,000
all other assets
28,000,000
26,000,000
total equity
36,800,000
31,900,000
total assets
$78,000,000
$56,600,000
total liabilities and equity
$78,000,000
$56,600,000
requirement 1. compute the profit margin ratio for win's companies for 2016.
begin by selecting the formula to calculate win's companies' profit margin ratio. then enter the amounts and calculate the profit margin ratio for 2016.
(round your answer to one tenth of a percent, x. x%.)
/
=
profit margin ratio
/
=
%
requirement 2. compute the rate of return on total assets for 2016.
begin by selecting the formula to calculate win's companies' rate of return on total assets. then enter the amounts and calculate the rate of return on total assets for 2016.
(round your answer to one tenth of a percent, x. x%.)
(
+
) /
=
rate of return on total assets
(
+
) /
=
%
requirement 3. compute the asset turnover ratio for 2016. begin by selecting the formula to calculate win's
companies' asset turnover ratio. then enter the amounts and calculate the assets turnover ratio for 2016.
(round your answers to two decimal places, x. xx.)
/
=
asset turnover ratio
/
=
requirement 4. compute the rate of return on common stockholders' equity for 62016.
begin by selecting the formula to calculate win's
companies' rate of return on common stockholders' equity. then enter the amounts and calculate the rate of return on commonstockholders' equity for 2016.
(abbreviation used: avg. common se = average commonstockholders' equity. complete all input boxes. enter "0" for balances with a zero value. round your answer to one tenth of apercent, x. x%.)
rate of return on common
(
-
) /
=
stockholders' equity
(
-
) /
=
%
requirement 5. are these rates of return strong or weak? explain your reasoning. (assume the following industryaverages: profit margin ratio = 22.8%, rate of return on total assets = 10.3%, asset turnover ratio= .54, rate of return on common stockholders' equity = 10.3%.
these rates of return are: 1) average 2) strong or 3) weak
considering that :
1) average companies present much higher rates of return
2)average companies present much lower rates of return
3) average companies present similar rates of return
▼
average companies present much higher rates of return
average companies present much lower rates of return.
average companies present similar rates of return.
Answers: 1
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Win's companies, a home improvement store chain, reported the following summarized figures:
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