River Rocks Inc. operates a large quarry in Central Ontario. Selected data from River Rocks for the year ended December 31, 2023 are presented below:

Total assets $1,600,000

Average total assets 1,500,000

Net earnings 123,200

Net sales 1,200,000

Average common shareholders' equity 1,000,000

Net cash provided by operating activities 280,000

Required

1. Calculate the profit margin and return on assets for River Rocks for the year ended December 31, 2023.
2. Comment on the ratios you prepared in part 1 assuming the following averages for the quarry industry:

Profit margin — 8%

Return on Assets — 14%

Answer rating: 100% (QA)

River Rocks Inc Profitability Analysis 2023 Calculations Profit Margin Profit Margin Net Earnings Ne... View the full answer