Peyton\'s Palace has net income of $18 million on sales revenue of $210 million.

Question

Peyton's Palace has net income of $18 million on sales revenue of $210 million. Total assets were $74 million at the beginning of the year and $96 million at the end of the year.

Calculate Peyton's return on assets, profit margin, and asset turnover ratios. (Round your answers to 2 decimal places. Omit the "%" sign in your response.)

Peyton's Palace has net income of $18 million on sales revenue of $210 million. Total assets were $74 million at the beginning of the year and $96 million at the end of the year.

Explanation / Answer

Return on assets = 18/(74+96)/2 = 27.17%

Profit margin = 18/210*100 = 8.57%

Asset turn over = 210/ (74+96)/2 = 2.47 times

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