FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Barry Sanders, likely the best running back to ever play footbalI, has opened a successful used-car dealership. He has
noted a higher than normal percentage of sales for trucks and SUVS with hauling capacity at his dealership. He is also
aware that several of the best recreational lakes in the state are located nearby. Barry is considering expanding his
dealership to include the sale of recreational boats. Barry provides the following projections of net sales, net income, and
average total assets in support of his proposal.
Cars Only
$6,400,000
400,000
1,600,000
Cars and Boats
Net sales
$7,600,000
Net income
600,000
1,800,000
Average total assets
Required:
1. Calculate Barry's return on assets, profit margin, and asset turnover for cars only.
Return on Assets
Choose Numerator
Choose Denominator
=
Return on Assets
Return on assets
Profit Margin
Choose Numerator
Choose Denominator
Profit Margin
=
Profit Margin
3D
=
Asset Turnover
Choose Numerator
Choose Denominator
Asset Turnover
=
Asset Turnover
times
=
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Transcribed Image Text:! Required information [The following information applies to the questions displayed below.] Barry Sanders, likely the best running back to ever play footbalI, has opened a successful used-car dealership. He has noted a higher than normal percentage of sales for trucks and SUVS with hauling capacity at his dealership. He is also aware that several of the best recreational lakes in the state are located nearby. Barry is considering expanding his dealership to include the sale of recreational boats. Barry provides the following projections of net sales, net income, and average total assets in support of his proposal. Cars Only $6,400,000 400,000 1,600,000 Cars and Boats Net sales $7,600,000 Net income 600,000 1,800,000 Average total assets Required: 1. Calculate Barry's return on assets, profit margin, and asset turnover for cars only. Return on Assets Choose Numerator Choose Denominator = Return on Assets Return on assets Profit Margin Choose Numerator Choose Denominator Profit Margin = Profit Margin 3D = Asset Turnover Choose Numerator Choose Denominator Asset Turnover = Asset Turnover times =
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