1.
Concept Introduction:
Assets Turnover: The ratio that helps determine how well a company can use its assets to generate revenue is referred to as asset turnover. This ratio is used by investors to measure the efficiency of a company and also its performance.
The assets turnover ratio of Company A and Company G.
2.
Concept Introduction:
Assets Turnover: The ratio that helps determine how well a company can use its assets to generate revenue is referred to as asset turnover. This ratio is used by investors to measure the efficiency of a company and also its performance.
The company which is considered to be more efficient in generating net sales to total assets.
3.
Concept Introduction:
Assets Turnover: The ratio that helps determine how well a company can use its assets to generate revenue is referred to as asset turnover. This ratio is used by investors to measure the efficiency of a company and its performance.
Whether the asset turnover underperformed or outperformed for Company A and Company G.
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FINANCIAL & MANAGERIAL ACCOUNTING (ACCES
- Analyze Home Depot The Home Depot (HD) reported the following data (in millions) in its recent financial statements: a. Determine the asset turnover ratio for Home Depot for Year 2 and Year 1. Round to two decimal places. b. What conclusions can be drawn from these ratios concerning the change in the ability of Home Depot to effectively use its assets to generate sales?arrow_forwardWhat is the comparison (analysis) of the Fixed Asset Turnover Ratio of Industry Average Ratio and the Company A Ratio? The Fixed Asset Turnover Ratio has decreased and increased. Why? Industry Average Fixed Asset Turnover Ratio 2015: 3.00 2016: 3.18 2017: 3.58 2018: 2.23 2019: 2.94 Company A Fixed Asset Turnover Ratio 2015: 7.48 2016: 6.14 2017: 7.70 2018: 4.59 2019: 6.38arrow_forwardComparative figures for Apple and Google follow. Apple Google One Year Prior Two Years Prior Current Year $375,319 229,234 One Year Prior $321,686 215,639 Two Years Prior $290,345 233,715 Current Year $ millions Total assets Net sales $197,295 $167,497 $147,461 90,272 74,989 Required: 1. Compute total asset turnover for the most recent two years for Apple and Google using the data shown. 2. In the current year, which company is more efficient in generating net sales given total assets? 3. Does each company's asset turnover underperform or outperform the industry (assumed) asset turnover of 0.5 for: (a) Apple and (b) Google?arrow_forward
- refer to the photo below. Please provide a complete and correct solution.arrow_forward[The following information applies to the questions displayed below.] Simon Company's year-end balance sheets follow. At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Current Year $ 27,970 80, 264 100,917 9,097 251,134 $ 469,382 Income tax expense Total costs and expenses Net income Liabilities and Equity Accounts payable Long-term notes payable Common stock, $10 par value Retained earnings Total liabilities and equity For both the current year and one year ago, compute the following ratios: $ 116,876 90,891 163,500 98,115 $ 469,382 $ 372,220 189,161 10,373 7,933 The company's income statements for the current year and 1 year ago, follow. For Year Ended December 31 Sales Cost of goods sold Other operating expenses Interest expense Current Year 1 Year Ago $ 31,400 58, 349 77,104 8,412 229,375 $ 404,640 Exercise 13-10 (Algo) Analyzing efficiency and profitability LO P3 $ 610,197 $ 70,436 92,137 163,500 78,567 $ 404,…arrow_forwardPlease solve the question sub-division b alone.arrow_forward
- Provide solution for this correct answerarrow_forwardWhat are three of the benefits of common-sized analysis using the inverse operating asset turnover (ATO) ratios? a) provides insight into the age of the assets b) the item is expressed as a percentage of current year sales c) is more comparable year-to-year than other methods d) negates the issue with small denominators e) it provides a common denominator for all accountsarrow_forwardBarry's BBQ had sales revenue for the year of $400 million and net income of $30 million. Total assets were $50 million at the beginning of the year, and $60 million at the end of the year. Required: Calculate the following ratios: (Do not round intermediate calculations. Round your answers to one decimal place.) 1. Return on assets ratio 2. Profit margin ratio 3. Asset turnover ratio Return on assets Profit margin Asset turnover % timesarrow_forward
- a.Compute the 2017 return on assets (ROA) for both companies. b.Disaggregate ROA into profit margin (PM) and asset turnover (AT) for each company. Confirm that ROA = PM x AT. c.Discuss differences observed with respect to PM and AT and interpret these differences in light of each company’s business model.arrow_forwardUse the following Income Statement and Balance Sheet Information for 2018 to answer the question below. This is a Retail Company. All numbers are in Millions. Income Statement Total Sales213.8 Cost of Sales151.3 Gross Profit213.8-151.3 Selling and Administrative Expenses22.3 Research and Development 7.7 Depreciation and Amortization4.5 Other Income2.4 EBIT213.8-151.3-22.3-7.7-4.5+2.4 Interest Expense5.8 Pretax Income213.8-151.3-22.3-7.7-4.5+2.4-5.8 Taxes( 213.8-151.3-22.3-7.7-4.5+2.4-5.8 )*0.30 Net Income( 213.8-151.3-22.3-7.7-4.5+2.4-5.8 )*0.70 Balance Sheet Assets Liabilities Cash65.8Accounts Payable43.3Accounts Receivable54.4Notes Payable/Short term debt1.6Inventories4.4 Total Current Assets65.8+54.4+4.4Total Current Liabilities43.3+1.6 Net property, plant and equipment103.4Long-term debt80.0Total long-term assets103.4Total long-term debt liabilities80.0 Total Liabilities43.3+1.6+80.0 Stockholders' Equity (Total Equity)65.8+ 54.4+4.4+103.4-43.3-1.6-80.0Total…arrow_forwardAsset Efficiency Ratios Selected financial statement numbers for Rutherford Company follow. Required: 1. Using this information, calculate Rutherfords receivable turnover ratio (rounded to two decimal places.) 2. Using this information, calculate Rutherfords asset turnover ratio (rounded to two decimal places) and also convert the ratio into days (rounded to the nearest whole day).arrow_forward
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