- Annual report: The annual report includes a general description of the company, audited statements of income, financial position , cash flow and notes to the statements providing details for various line items. Return on assets: It is the ratio of annual net income to average total assets of a business during a financial year. It is a profitability ratio. Higher value of ROA shows that the business is more profitable. Return on assets = Annual net income / Average Total assets. Debt ratio: It is the ratio of total liabilities to total assets. It is a financial ratio, which interprets the portion of the company's assets that are financed by debts. Debt ratio = Total liabilities/Total Assets. Profit Margin: It is the ratio of net income to net sales, also known as return on sales ratio or gross profit ratio. It is the profitability ratio. It shows what percentage of sales is left over all expenses that are paid by the business. To compute: Return on assets Debt ratio Profit Margin

Question

Want to see the full answer?

Answer 1

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 3, Problem 2BTN

To determine

Concept Introduction:-

Annual report:

The annual report includes a general description of the company, audited statements of income, financial position, cash flow and notes to the statements providing details for various line items.

Return on assets: It is the ratio of annual net income to average total assets of a business during a financial year. It is a profitability ratio. Higher value of ROA shows that the business is more profitable.

Return on assets = Annual net income / Average Total assets.

Debt ratio: It is the ratio of total liabilities to total assets. It is a financial ratio, which interprets the portion of the company's assets that are financed by debts.

Debt ratio = Total liabilities/Total Assets.

Profit Margin:

It is the ratio of net income to net sales, also known as return on sales ratio or gross profit ratio. It is the profitability ratio. It shows what percentage of sales is left over all expenses that are paid by the business.

To compute:

Return on assets

Debt ratio

Profit Margin

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

solve qn no. 3

Horngren's Financial & Managerial Accounting: The Managerial Chapters, 8th Edition. E-M:2-19 Accounting for job costs Brook Trailers’ job cost records yielded the following information: Job No. Date Total Cost of Job at July 31 Started Finished Sold 1 21-Jun 16-Jul 17-Jul $ 3,100 2 29-Jun 21-Jul 26-Jul 13,000 3 3-Jul 11-Aug 13-Aug 6,900 4 7-Jul 29-Jul 1-Aug 4,400 Use the dates in the table to identify the status of each job. Compute the following balances for Brook Trailers: a. Work-in-Process Inventory at July 31 b. Finished Goods Inventory at July 31 c. Cost of Goods Sold for July c. COGS $16,100

Donald Diesel owns the Fredonia Barber Shop. He employs 5 barbers and pays each a base salary of $1,380 per month. One of the barbers serves as the manager and receives an extra $535 per month. In addition to the base salary, each barber also receives a commission of $3.75 per haircut. Other costs are as follows. Advertising $270 per month Rent $1,010 per month Barber supplies $0.50 per haircut Utilities $160 per month plus $0.15 per haircut Magazines $35 per month Donald currently charges $11.00 per haircut. Compute the break-even point in sales units and in sales dollars. Break-even point Break-even point sales $ haircuts

Answer 2

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 3, Problem 2BTN

To determine

Concept Introduction:-

Annual report:

The annual report includes a general description of the company, audited statements of income, financial position, cash flow and notes to the statements providing details for various line items.

Return on assets: It is the ratio of annual net income to average total assets of a business during a financial year. It is a profitability ratio. Higher value of ROA shows that the business is more profitable.

Return on assets = Annual net income / Average Total assets.

Debt ratio: It is the ratio of total liabilities to total assets. It is a financial ratio, which interprets the portion of the company's assets that are financed by debts.

Debt ratio = Total liabilities/Total Assets.

Profit Margin:

It is the ratio of net income to net sales, also known as return on sales ratio or gross profit ratio. It is the profitability ratio. It shows what percentage of sales is left over all expenses that are paid by the business.

To compute:

Return on assets

Debt ratio

Profit Margin

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 3, Problem 2BTN

To determine

Concept Introduction:-

Annual report:

The annual report includes a general description of the company, audited statements of income, financial position, cash flow and notes to the statements providing details for various line items.

Return on assets: It is the ratio of annual net income to average total assets of a business during a financial year. It is a profitability ratio. Higher value of ROA shows that the business is more profitable.

Return on assets = Annual net income / Average Total assets.

Debt ratio: It is the ratio of total liabilities to total assets. It is a financial ratio, which interprets the portion of the company's assets that are financed by debts.

Debt ratio = Total liabilities/Total Assets.

Profit Margin:

It is the ratio of net income to net sales, also known as return on sales ratio or gross profit ratio. It is the profitability ratio. It shows what percentage of sales is left over all expenses that are paid by the business.

To compute:

Return on assets

Debt ratio

Profit Margin

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 3, Problem 2BTN

To determine