- Asset turnover represents
The ability to generate sales from a particular investment in assets
- Carl Industries
Carl Industries has condensed balance sheets as shown:
2011
2010
2009
Assets:
Current assets
$55,000
$56,500
$70,000
Plant & equipment, net
495,000
410,000
440,000
Intangible assets, net
20,000
27,500
40,000
Total assets
$570,000
$494,000
$550,000
Liabilities & Stockholders' Equity:
Current liabilities
$40,000
$35,000
$32,500
Long-term liabilities
395,000
310,000
375,000
Stockholders' equity
135,000
149,000
142,500
Total liabilities & equity
$570,000
$494,000
$550,000
Refer to the information for Carl Industries. In a percentage change balance sheet over the period of 2009 to 2011, what is the change in long-term liabilities?
5.3%
- Refer to the information for Carl Industries. In a common size balance sheet for 2009, total liabilities and equity are expressed as
100%
- Refer to the information for Carl Industries. In a common size balance sheet for 2010, plant and equipment (net) is expressed as
83%
- Refer to the information for Carl Industries. In a percentage change balance sheet over the period of 2009 to 2011, what is the change in current assets?
(21.4%)
- Common-size analysis requires the analyst to be aware that percentages can change because of all of the following except:
changes in sales independent of changes in expenses
changes in expenses in the numerator independent of changes in sales
interaction effects between the numerator and denominator
- Critics of EPS as a measure of profitability point out that it does not consider:
the amount of assets or capital required to generate a particular level of earnings
- Below is financial information for two sporting goods retailers. Extreme Sports Company operates a retail business and franchising business. At the end 2011, Extreme Sports had 263 Company-owned and 120 franchise-operated retail stores. Extreme's stores are located in suburban, strip mall and regional mall locations, the company operates in 32 states. All Sports Corporation sells sporting goods and related products at over 2,500 Company-operated retail stores.
Selected Data for All Sports and Extreme Sports
(amounts in millions)
All Sports
Extreme Sports
Sales
$5,320
$1,344
Cost of Goods Sold
3,897
887
Interest Expense
138
43
Net Income
212
33
Average Inventory
998
286
Average Fixed Assets
1,163
130
Average Total Assets
2,472
662
Average Tax Rate
40%
40%
Refer to the information for Extreme Sports Company and All Sports Corporation.
Compute the return on assets for Extreme Sports
8.9%
- What is the return on assets for All Sports?
11.9%
- Calculate All Sports' inventory turnover ratio
3.9