Help I System Announcements CALCULATOR PRINTER VERSION NEXT Lymen International
ID: 2336045 • Letter: H
Question
Help I System Announcements CALCULATOR PRINTER VERSION NEXT Lymen International is considering a significant expansion to its product line. The sales force is excited about the opportunities that products will bring. The new products are a significant step up in quality above the company's current offerings, but offer a complemer fit to its existing product line. Fred Riddick, senior production department manager, is very excited about the high-tech new e will have to be acquired to produce the new products. Barbara Dyson, the company's CFO, has provided the following proj results with and without the new products. Without New With New Produ $12,428,600 50,100 $5,867,000 $16,791,200 $876,500 $13,625,700 (a) Compute the company's return on assets, profit margin, and asset turnover, both with a , the new product line. (Round answers to 0 decimal places, e.g. 2% and asset turnover to I decimal place, e.g. 6.2 Without new products With new products Return on assets 6.4 Profit margin Asset turnover 2.12 552 PM w)9/19/2018 DELLExplanation / Answer
Working
Without New product
With new product
Return on assets
450100/5867000
7.7%
876500/13625700
6.4%
Profit margin
450100/12428600
4%
876500/13625700
6%
Asset Turnover
12428600/5867000
2.12
16791200/13625700
1.23
Formula
Return on assets
=
Net income/Average total assets
Profit margin
=
Net income/sales
Asset Turnover
=
Net sales/Average total assets
Answers
Without New product
With new product
Return on assets
7.7%
6.4%
Profit margin
4%
6%
Asset Turnover
2.12
1.23
Notes
The question is asking to round Asset turnover ratio to 1 decimal place only and other ratios to zero decimal place.
Both Asset turnover and Profit margin are correctly except profit margin with new products. calculated. The answers are not accepting only because of round off .
Working
Without New product
With new product
Return on assets
450100/5867000
7.7%
876500/13625700
6.4%
Profit margin
450100/12428600
4%
876500/13625700
6%
Asset Turnover
12428600/5867000
2.12
16791200/13625700
1.23
Formula
Return on assets
=
Net income/Average total assets
Profit margin
=
Net income/sales
Asset Turnover
=
Net sales/Average total assets
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