Firm D has net income of $83,700, sales of $2,790,000, and average total assets

Question

Firm D has net income of $83,700, sales of $2,790,000, and average total assets of $1,395,000. Calculate the firm's margin, turnover, and ROI. (Omit the "%" sign in your response.)


Margin %
Turnover
ROI %

(b) Firm E has net income of $150,000, sales of $2,500,000, and ROI of 15%. Calculate the firm's turnover and average total assets. (Omit the "$" sign in your response.)


Turnover $
Average total assets

(c) Firm F has ROI of 12.6%, average total assets of $1,730,159, and turnover of 1.4. Calculate the firm's sales, margin, and net income. (Round your answers to the nearest whole numbers. Omit the "$" and "%" signs in your response.)


Net income $
Sales $
Margin %

Explanation / Answer

a.

Margin% = Net Income/Net Sales = 83,700/2790000 = 0.03 or 3%

turnover = Net Sales/Average Total assets = 2790000/1395000 = 2 times

ROI% = net income/average total assets = 83700/1395000 = 0.06 or 6%

b. (I had to do average total assets first)

turnover = Net Sales/Average Total assets = 2,500,000/1,000,000 = 2.5 times

average total assets = net income/ROI = 150,000/0.15 = $1,000,000

c.

net income = ROI*assets = 12.6%*1730159 = $218,000.

sales = turnover*average total assets = 1.4*1730159 = $2,422,223

margin% = net income/sales = 218,000.03/2,422,222.60 = 0.09 or 9%

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