Use the financial statement data for Castillo Products presented in Problem 7. A. Calculate the net profit

Question:

Use the financial statement data for Castillo Products presented in Problem 7.

A. Calculate the net profit margin in 2009 and 2010 and the sales-to-total-assets ratio using year-end data for each of the two years.

B. Use your calculations from Part A to determine the rate of return on assets in each of the two years for Castillo Products.

C. Calculate the percentage growth in net sales from 2009 to 2010. Compare this with the percentage change in total assets for the same period.

D. Express each expense item as a percentage of net sales for both 2009 and 2010. Describe what happened that allowed Castillo Products to move from a loss to a profit between the two years.


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Entrepreneurial Finance

ISBN: 978-0538478151

4th edition

Authors: J . chris leach, Ronald w. melicher

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