# Question

Use the information in E13-3 to complete the following requirements.

Required:

1. Compute the gross profit percentage for each year (rounded to one decimal place). Assuming that the change from 2009 to 2010 is the beginning of a sustained trend, is Computer Tycoon likely to earn more or less gross profit from each dollar of sales in 2011?

2. Compute the net profit margin for each year (expressed as a percentage with one deci-mal place). Given your calculations here and in requirement 1, explain whether Computer Tycoon did a better or worse job of controlling operating expenses in 2010 relative to 2009.

3. Computer Tycoon reported average net fixed assets of $54,200 in 2010 and $45,100 in

2009. Compute the fixed asset turnover ratios for both years (round to two decimal places).

Did the company better utilize its investment in fixed assets to generate revenues in 2010 or 2009?

4. Computer Tycoon reported average stockholders’ equity of $54,000 in 2010 and $40,800 in 2009. Compute the return on equity ratios for both years (expressed as a percentage with one decimal place). Did the company generate greater returns for stockholders in 2010 than in2009?

Required:

1. Compute the gross profit percentage for each year (rounded to one decimal place). Assuming that the change from 2009 to 2010 is the beginning of a sustained trend, is Computer Tycoon likely to earn more or less gross profit from each dollar of sales in 2011?

2. Compute the net profit margin for each year (expressed as a percentage with one deci-mal place). Given your calculations here and in requirement 1, explain whether Computer Tycoon did a better or worse job of controlling operating expenses in 2010 relative to 2009.

3. Computer Tycoon reported average net fixed assets of $54,200 in 2010 and $45,100 in

2009. Compute the fixed asset turnover ratios for both years (round to two decimal places).

Did the company better utilize its investment in fixed assets to generate revenues in 2010 or 2009?

4. Computer Tycoon reported average stockholders’ equity of $54,000 in 2010 and $40,800 in 2009. Compute the return on equity ratios for both years (expressed as a percentage with one decimal place). Did the company generate greater returns for stockholders in 2010 than in2009?

## Answer to relevant Questions

Use the information in E13-3 to complete the following requirement.Required:Compute the times interest earned ratios for 2010 and 2009. In your opinion, does ComputerTycoon generate sufficient net income (before taxes and ...Dollar General Corporation operates approximately 9,400 general merchandise stores that feature quality merchandise at low prices to meet the needs of middle-, low-, and fixed-income families in southern, eastern, and ...A condensed balance sheet for Simultech Corporation and a partially completed vertical analysis are presented below.Required:1. Complete the vertical analysis by computing each line item (a)–(d) as a percentage of total ...A condensed income statement for Southwest Airlines and a partially completed vertical analysis are presented below.Required:1. Complete the vertical analysis by computing each line item (a)–(f) as a percentage of sales ...What are the three basic functions of management?Post your question

0