E12-9 The following condensed information is reported by Sporting Collectibles.
ID: 2600552 • Letter: E
Question
E12-9 The following condensed information is reported by Sporting Collectibles. NSs 52014 Income Stätement Information Sales revenue Cost of goods sold Net incom 39400,0 9,544,080 6,900,000 Balänce Sheet Informations Long term 98sets 2,300,000000.000 Totalassets $3,600,000 1,000,000 900,000 $4,000,000. uress Jiobilities ong term liabilities 900,000. .. 01:400,000 $4,000,0003600 00 1,4000 Common stock Retained earnings 400,000300:00 Total liabilities and stockholders' equity Required 1. Calculate the following profitability ratios for 2015: sHAA a. Gross profit ratio. F. BAAh b. Return on assets.PR c. Profit margin. d. Asset turnover. e. Return on equity i iUE|OPR-in, 2. Determine the amount of dividends paid to shareholders in 2015
Explanation / Answer
ANSWERS:
CALUCULATION OF PROFITABILITY RATIOS
GROSS PROFIT RATIO = (Gross profit /sales)*100
sales = 14820000 cost of goods sold = 9544080 Gross profit = 5275920 gross profit ratio =gross profit/sales = 0.356 35.6% RETURN ON ASSETS = NET INCOME/RETURN ON ASSETS 0.1045 10.45% PROFIT MARGIN = NET INCOME/NET SALES 0.028205128 2.820512821% ASSETS TURNOVER = NET SALES/ASSETS NET SALES 14820000 TOTAL ASSETS 4000000 3.705 370.5% RETURN ON EQUITY RETURN/EQUITY EQUITY = COMMON STOCK +RETAINED EARNINGS 1300000 = 0.321538462 32.15384615%Related Questions
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