Using the data in the following table for a number of firms in the same industry, do the following: Firm(in Millions of Dollars)ABCDSales$15$10$15$30Net income after tax1.750.502.001.50Total assets6.018.08.015.5Stockholders' equity13.010.06.05.0Compute the total asset turnover, the net profit margin, the equity multiplier, and the return on equity for each firm. Round your answers to two decimal places. ABCDTotal Asset Turnover x x x xNet Profit Margin Equity Multiplier x x x xReturn on Equity Evaluate each firm’s performance by comparing the firms with one another. Which firm has the lowest total asset turnover value?-Select-Firm AFirm BFirm CFirm DItem 17Which firm has the lowest net profit margin value?-Select-Firm AFirm BFirm CFirm DItem 18Which firm has the lowest equity multiplier value?-Select-Firm AFirm BFirm CFirm DItem 19Which firm has the lowest return on equity value?-Select-Firm AFirm BFirm CFirm DItem 20

Answer 1: Total Asset Turnover =Total SalesNet Assets Net Profit Margin = Net Income After taxNet…

Answered: Using the data in the following table…

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter15: Capital Investment Analysis

Section: Chapter Questions

Problem 15.5.3MBA

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Using the data in the following table for a number of firms in the same industry, do the following:

	Firm
(in Millions of Dollars)	A	B	C	D
Sales	$15	$10	$15	$30
Net income after tax	1.75	0.50	2.00	1.50
Total assets	6.0	18.0	8.0	15.5
Stockholders' equity	13.0	10.0	6.0	5.0

Compute the total asset turnover, the net profit margin, the equity multiplier, and the return on equity for each firm. Round your answers to two decimal places.

A B C D

Total Asset Turnover x x x x

Net Profit Margin

Equity Multiplier x x x x

Return on Equity
Evaluate each firm’s performance by comparing the firms with one another. Which firm has the lowest total asset turnover value?
-Select-Firm AFirm BFirm CFirm DItem 17
Which firm has the lowest net profit margin value?
-Select-Firm AFirm BFirm CFirm DItem 18
Which firm has the lowest equity multiplier value?
-Select-Firm AFirm BFirm CFirm DItem 19
Which firm has the lowest return on equity value?
-Select-Firm AFirm BFirm CFirm DItem 20

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