Using the following information from a balance sheet and an income statement, compute the (1) Profit Margin,
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Using the following information from a balance sheet and an income statement, compute the
(1) Profit Margin,
(2) Asset turnover,
(3) Return on assets,
(4) Debt to equity ratio, and
(5) Return on equity. (The previous year’s total assets were $200,000, and owner’s equity was $140,000.)
Total assets ........$240,000
Total liabilities ........ 60,000
Total owner’s equity ...... 180,000
Net sales .......... 260,000
Cost of goods sold ...... 140,000
Operating expenses ..... 80,000
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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