For 2016 and 2015, compute return on sales (ROS), asset turnover (AT), return on assets (ROA), leverage
Question:
For 2016 and 2015, compute return on sales (ROS), asset turnover (AT), return on assets (ROA), leverage (L), return on common stockholders' equity (ROE), gross profit percentage (GP), operating income percentage (01), and earnings per share (EPS) to measure the ability to earn profits of Harmony Decor, Inc., whose comparative income statements follow. Use DuPont Analysis for ROA and ROE, and round each component ratio to three decimals; for other ratio computations, round to two decimals.
Addititonal data:
Did the company's operating performance improve or deteriorate during 2016?
Asset TurnoverAsset turnover is sales divided by total assets. Important for comparison over time and to other companies of the same industry. This is a standard business ratio.
Harmony Decor, Inc. Comparative Income Statements Years Ended December 31, 2016 and 2015 2016 2015 $250,000199,000 102,000 Net sales Cost of goods sold Gross profit Selling and general expenses Income from operations Interest expense Income before income tax Income tax expense Net income 123,000 102 127,000 97000 55,00051,000 46,000 14,00018,000 28,000 10,000 72,000 4 58,000 20,000 2016 2015 2014 ..$310,000 $305,000 $ 300,000 , $196,000 $194,000 $ 192,000 Common stockholders' equity.... Preferred dividend.... Average common shares outstanding 2,000 S 1,000 S during the year.... 15,000 14,000 13,000
Step by Step Answer:
a Return on net sales 2016 38000 2000 0144 2015 18000 1000 0085 250000 199000 b Asse...View the full answer
Financial Accounting
ISBN: 978-0134127620
11th edition
Authors: Walter Harrison, Charles Horngren, William Thomas, Wendy Tietz
Related Video
The Dupont analysis is an expanded return on equity formula, calculated by multiplying the net profit margin by the asset turnover by the equity multiplier. The DuPont analysis is also known as the DuPont identity or DuPont model.This Video will guide on how to calculate return on Equity and estimate profitability of shareholders using DuPont Analysis.
Students also viewed these Cost Accounting questions
-
Compute return on sales (ROS), asset turnover (AT), return on assets (ROA), leverage (L), return on common stockholders equity (ROE), gross profit (GP), operating income percentage (OI), and earnings...
-
Compute four ratios that measure the ability to earn profits for Harmon Decor, Inc., whose comparative income statements follow: Additional data: Did the companys operating performance improve or...
-
Compute return on sales (ROS), asset turnover (AT), return on assets (ROA), leverage (L), return on common stockholders equity (ROE), gross profit (GP), operating income percentage (OI), and earnings...
-
Determine which sets of vectors are orthogonal. 3 -2 1 3 -1 3 -3 4 3 8 7 0
-
Roddickton Manufacturing Co. has gathered the following information to develop predetermined OH rates for 2010. The company produces a wide variety of energy-saving products that are processed...
-
What morphological and physiological adaptations facilitate the terrestrial lifestyle of reptiles and birds? Explain
-
Using the wine quality data from Table B.11, fit a model relating wine quality $y$ to flavor $x_{4}$ using region as an allocated code, taking on the values shown in the table $(1,2,3)$. Discuss the...
-
The following list of accounts is taken from the adjusted trial balance of Goforth Company. Accounts Payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $45,000...
-
Before the widespread adoption of Layer-2 switches, networks used hubs to connect devices together. What were some the drawbacks to this? What kind of issues did Network Administratorsfrequently...
-
Why should one study operations management?
-
Irvin Furniture Company has requested that you determine whether the company's ability to pay its current liabilities and long-term debts improved or deteriorated during 2016. To answer this...
-
Evaluate the common stock of Bastille Distributing Company as an investment. Specifically, use the three common stock ratios to determine whether the common stock increased or decreased in...
-
A regular polygon of n sides is inscribed in a circle of radius r. Find formulas for the perimeter, P, and area, A, of the polygon in terms of n and r.
-
You measure the oscillation frequency \(f_{\text {whole }}\) of a vertical block-spring system. You then cut the spring in half, hang the same block from one of the halves, and measure the frequency...
-
A vertical spring-block system with a period of \(2.3 \mathrm{~s}\) and a mass of \(0.35 \mathrm{~kg}\) is released \(40 \mathrm{~mm}\) below its equilibrium position with an initial upward velocity...
-
What would be the period of oscillation of this book if you held it at one corner between index finger and thumb and allowed it to swing slightly? To first order, ignore any effect on the oscillation...
-
Walt Hubble is contemplating selling rental property that originally cost \($200,000.\) He believes that it has appreciated in value at an annual rate of 6% over its 4-year holding period. He will...
-
If the amplitude of a simple harmonic motion doubles, what happens to \((a)\) the energy of the system, \((b)\) the maximum speed of the moving object, and \((c)\) the period of the motion?
-
An initially empty 5-ft 3 tank is filled with air from 70 F, 15 psia until it is full. Assume no heat transfer and find the final mass and entropy generation.
-
XYZ Inc. a calendar year, accrual basis corporation, had the following items during 2021: Gross revenue from operations Cost of goods sold $420,000 ($180,000) $9,000 LT capital gain .LT capital...
-
On January 1, 2012, Carlton Myers established Vista Realty. Carlton completed the following transactions during the month of January:a. Opened a business bank account with a deposit of $25,000 in...
-
The financial statements at the end of Alpine Realty?s first month of operations are as follows: Instructions By analyzing the interrelationships among the four financial statements, determine the...
-
Cody Macedo established an insurance agency on January 1 of the current year and completed the following transactions during January: a. Opened a business band account with a deposit of $75,000 in...
-
You have a business worth $1,000,000 and other assets (including your home) worth an additional $750,000. What is the recommended automobile insurance policy that you should carry to be FULLY...
-
Republic Services and Waste Management company Compare the companies' long term Revenue, Gross Profit, Operating Profit) and Net Income and related growth trends. What is the average three year...
-
A young couple own a home in NJ. They would like to have Homeowner Insurance coverage for their home in NJ, in case of frozen plumping and damage form heavy snow or power surges. Which Homeowner's...
Study smarter with the SolutionInn App