question archive Step Up Ladders Company provides the following financial? information: Income from operations $400,000 Interest expense 46,000 ?Gains/(losses) on sale of equipment 2,500 Net income 351,500 Total assets at Jan
Step Up Ladders Company provides the following financial? information: Income from operations $400,000 Interest expense 46,000 ?Gains/(losses) on sale of equipment 2,500 Net income 351,500 Total assets at Jan
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Step Up Ladders Company provides the following financial? information:
Income from operations $400,000
Interest expense 46,000
?Gains/(losses) on sale of equipment 2,500
Net income 351,500
Total assets at Jan. 1 2,600,000
Total assets at Dec .31 3,200,000
Calculate return on investment based on the information given above.? (Round your answer to two decimal? places.)
A. 15.38?%
B. 12.50?%
C. 12.12?%
D. 13.79?%
ccelerated Logistics provides the following? information:
Operating income $1,500,000
Net sales $15,000,000
Average total assets $2,000,000
?Management's target rate of return 25?%
What is the? company's profit margin? ratio? (Round your answer to two decimal? places.)
A. 75.00?%
B. 1.10?%
C. 10.00?%
D. 13.33?%
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Computation of return on investment:
Total average assets = (Total assets at Jan. 1 + Dec. 31) / 2
= $(2,600,000 + 3,200,000)/ 2 = $2,900,000
Return on investment = Net income/total average assets
= ($351,500*100)/$2,900,000 = 12.12%
Computation of the Company's profit margin:
Company's profit margin = (Operating income/Net sales) *100
= $(1,500,000/15,000,000) *100 = 10.00 %
