The 2018 income statement of Adrian Express reports sales of $15.2 million, cost of goods sold...

  

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The 2018 income statement of Adrian Express reports sales of $15.2 million, cost of goods sold of $10 million, and net income of $3.2 million. Balance sheet information is provided in the following table. Assets Current assets: Cash Accounts receivable Inventory Long-term assets Total assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities Common stock Retained earnings ADRIAN EXPRESS Balance Sheet December 31, 2018 and 2017 Total liabilities and stockholders' equity Gross profit ratio Return on assets Profit margin Asset turnover 2018 25 % 15% 10% 1.5 times $ 800,000 2,100,000 1,500,000 5,200,000 Industry averages for the following profitability ratios are as follows: $1,800,000 1.500,000 1,600,000 5,400,000 $9,600,000 $9,700,000 3,000,000 3,300,000 $9,600,000 2017 $ 900,000 1,800,000 $2,000,000 2,100,000 3,000,000 2,600,000 $9,700,000 Industry averages for the following profitability ratios are as follows: Gross profit ratio Return on assets Profit margin Asset turnover Return on equity Profitability Ratios. Required: 1. Calculate the five profitability ratios given below for Adrian Express. (Round your answers to 1 decimal place.) Gross profit ratio Return on assets 25% 15% Profit margin Asset turnover Return on equity 10 % 1.5 times 25% % % % times % 2. Do you think the company is more profitable or less profitable than the industry average? The 2018 income statement of Adrian Express reports sales of $15.2 million, cost of goods sold of $10 million, and net income of $3.2 million. Balance sheet information is provided in the following table. Assets Current assets: Cash Accounts receivable Inventory Long-term assets Total assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities Common stock Retained earnings ADRIAN EXPRESS Balance Sheet December 31, 2018 and 2017 Total liabilities and stockholders' equity Gross profit ratio Return on assets Profit margin Asset turnover 2018 25 % 15% 10% 1.5 times $ 800,000 2,100,000 1,500,000 5,200,000 Industry averages for the following profitability ratios are as follows: $1,800,000 1.500,000 1,600,000 5,400,000 $9,600,000 $9,700,000 3,000,000 3,300,000 $9,600,000 2017 $ 900,000 1,800,000 $2,000,000 2,100,000 3,000,000 2,600,000 $9,700,000 Industry averages for the following profitability ratios are as follows: Gross profit ratio Return on assets Profit margin Asset turnover Return on equity Profitability Ratios. Required: 1. Calculate the five profitability ratios given below for Adrian Express. (Round your answers to 1 decimal place.) Gross profit ratio Return on assets 25% 15% Profit margin Asset turnover Return on equity 10 % 1.5 times 25% % % % times % 2. Do you think the company is more profitable or less profitable than the industry average?

Answer rating: 100% (QA)

Step 1 Ratio Analysis Ratio analysis is the mathematical expression between the two items of the fin... View the full answer