121/2017 Problem 9-7A *Problem 9-7A Blue Corporation and Bramble Corporation, tw

Question

121/2017 Problem 9-7A *Problem 9-7A Blue Corporation and Bramble Corporation, two companies of roughly the same size, are both involved in the manufacture of shoe-tracing devices. Each company depreciates its plant assets using the straight-line approach. An investigation of their financial statements reveals the information shown below Net income Sales revenue Total assets (average) Plant assets (average) Intangible assets (goodwill) Blue Corp. $269,000 1,306,000 4,106,000 272,000 374,100 Bramble Corp. 329,000 1,360,500 3,831,000 1,852,000 For each company, calculate these values: (Round answers to 2 decimal places, eg. 6.25% or 17.54.) Blue Corp Bramble Corp (1) Return on assets (2) Profit margin (3) Asset turnover times times Question Attempts: 0 of 2 used CopyrightO2000-2017 by John Wlley & Sons, Ina or related companles. All rights reserved https:lledugen.wileyplus.com edugenisharedfassignmenties gprint.uni

Explanation / Answer

Calculate following :

Blue corp Bramble corp Return on assets 269000*100/4106000 = 6.55% 329000*100/3831000 = 8.59% Profit margin 269000*100/1306000 = 20.60% 329000*100/1360500 = 24.18% Assets turnover 1306000/4106000=0.32 1360500/3831000 = 0.36

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