Use the following information to work the remainder of the exam: In its closing
ID: 2786273 • Letter: U
Question
Use the following information to work the remainder of the exam: In its closing financial statements for its first year of business, the Runs and Goses Company had cash of $242, accounts receivable of $850, inventory of $820, net fixed assets of $3,408, accounts payable of $700, short-term notes payable of $740, long-term liabilities of $1,100, common stock of S1,160, retained earnings of S1,620, net sales to retained earnings of $508 and dividends paid of $218. of $2,768, cost of goods sold of $1,210, depreciation of $360, interest expense of $160, taxes of $312, addition 13.) Compute the return on equity. 14) Compute the return on total assets 15.) Compute the net profit margin. 16) Compute the operating profit margin. 17) Compute the gross profit margin.Explanation / Answer
As per chegg guideline in case of multiple question we have to answer 4 question:
Particular Amount Sales 2768 cost of good sold 1210 less Depreciation 360 less EBIT 1198 Interest expense 160 less profit before tax 1038 taxes 312 less Net income 726 dividend paid 218 less Income transfer to retained earning 508 13 Equity=common stock+retained earning+addition to retained earning Equity=1160+1620+508 Equity 3288 Net income 726 Return on equity=Net income/total equity ROE=726/3288 ROE= 22.08% 14 Total asset=cash+A/R+inventory+net fixed asset Total asset=242+850+820+3408 Total asset= 5320 Net income 726 Return on asset=Net income/total asset Return on asset=726/5320 ROA= 13.65% 15 Net profit margin=Net income/sale Net profit margin=726/2768 Net profit margin= 26.23% 16 operating profit margin=EBIt/sale operating profit margin=1198/2768 operating profit margin= 43.28%