Firm M has a margin of 10%, turnover of 1.6, sales of $850,000, and average stoc
ID: 2469722 • Letter: F
Question
Firm M has a margin of 10%, turnover of 1.6, sales of $850,000, and average stockholders' equity of $340,000. Required: Calculate Firm M’s average total assets, net income, return on investment (ROI), and return on equity (ROE).
the choices to choose from for numerator and denominator: ( sales, turnover, margin, net income, average total assets, average stockholder equity)
AVERAGE TOTAL ASSETS
NET INCOME
RETURN ON INVESTMENT
RETURN ON EQUITY
Choose numerator choose denominator average total assets / = average total assets / =Explanation / Answer
AVERAGE TOTAL ASSETS=SALES*1.6 1360000 (850000*1.6) NET INCOME =SALES *MARGIN 85000 (850000*10%) ROI=NET INCOME/AVEARGE TOTAL ASSET 6.25% (85000/1360000) ROE=NET INCOME/average stockholders' equity 25.00% (85000/340000)
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.