If ABC's current total asset turnover was 2.0 and ABC was able to raise its total...

 

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If ABC's current total asset turnover was 2.0 and ABC was able to raise its total asset turnover ratio to 3.0 while maintaining its current operating profit margin (12.0%), (a) What would happen to its operating return on assets? (b) What activities should be done to increase its operating return on assets? If ABC's current total asset turnover was 2.0 and ABC was able to raise its total asset turnover ratio to 3.0 while maintaining its current operating profit margin (12.0%), (a) What would happen to its operating return on assets? (b) What activities should be done to increase its operating return on assets?

Answer rating: 100% (QA)

a To determine the impact on ABCs operating return on assets ROA we need to multiply the operating profit margin by the total asset turnover ratio Ope... View the full answer