Shamrock International is considering a significant expansion to its product line. The sales force is excited about the opportunities th the new products will bring. The new products are a significant step up in quality above the company's current offerings, but offer a complementary fit to its existing product line. Fred Ridtdick, senior production department manager, is very excited about the high- tech new equipment that will have to be acquired to produce the new products. Barbara Dyson, the company's CFO, has provided the following projections based on results with and without the new products. Without New Products With New Products

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Shamrock International is considering a significant expansion to its product line. The sales force is excited about the opportunities that
the new products will bring. The new products are a significant step up in quality above the company's current offerings, but offer a
complementary fit to its existing product line. Fred Ridtdick, senior production department manager, is very excited about the high-
tech new equipment that will have to be acquired to produce the new products. Barbara Dyson, the company's CFO, has provided the
following projections based on results with and without the new products.
Sales revenue
Net income
Average total assets
Return on assets
Profit margin
Without New
Products
$11,761,800
Asset turnover
$470,472
$5,880,900
(a) Compute the company's return on assets, profit margin, and asset turnover, both with and without the new product line. (Round
return on assets and profit margin to 0 decimal places, e.g. 15% and asset turnover to 2 decimal places, e.g. 15.25.)
With New Products
Without New Products
%
$16,725,840
$836,292
$13,938,200
%
times
With New Products
%
%
times
Transcribed Image Text:Shamrock International is considering a significant expansion to its product line. The sales force is excited about the opportunities that the new products will bring. The new products are a significant step up in quality above the company's current offerings, but offer a complementary fit to its existing product line. Fred Ridtdick, senior production department manager, is very excited about the high- tech new equipment that will have to be acquired to produce the new products. Barbara Dyson, the company's CFO, has provided the following projections based on results with and without the new products. Sales revenue Net income Average total assets Return on assets Profit margin Without New Products $11,761,800 Asset turnover $470,472 $5,880,900 (a) Compute the company's return on assets, profit margin, and asset turnover, both with and without the new product line. (Round return on assets and profit margin to 0 decimal places, e.g. 15% and asset turnover to 2 decimal places, e.g. 15.25.) With New Products Without New Products % $16,725,840 $836,292 $13,938,200 % times With New Products % % times
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