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Question
t secure v gagenow ent/takeAssignmentMain.do?invoker-assignments&itakeAssignmentSessionLocator-assignment-take;&inprogress-false; xercises eBook Profit Margin, Investment Turnover, and ROI Cash Company has income from operations of $45,144, invested assets of $216,000, and sales of $410,400. Use the DuPont formula to compute the return on Show Me How investment. If required, round your answers to two decimal places a. Profit margin b. Investment turnover c. Return on investment Previous Next Check My Work 2 more Check lMy Work uses remaining 2 more Check My Work uses remaining 11:37 PMExplanation / Answer
SOLUTION
(A) Profit margin =Iincome from operations / Sales
= $45,144 / $410,400
= 11%
(B) Investment turnover = Sales / Invested assets
= $410,400 / $216,000
= 1.9
(C) Rate of return on investment = Profit margin * Investment turnover
= 11% * 1.9
= 20.9%
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