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Consider the following Income Statement and Balance Sheet (in thousands): Net Revenue $5
Consider the following Income Statement and Balance Sheet (in thousands): Net Revenue $5.750 Net Income $725 BALANCE SHEET Current Current Access 720 5 449 Liabilities 3 Investments 180 Long-term debt 5 365 Property Total $ 1.150 equipment Labs 1,314 Equity 5 Total Assets $ 2,050 TotalL&E $2,050 Calculate the following ratios/percentages to 2 decimal pts: W 9. (2pts) Return on Assets (ROA) Formula Required $10.(2pts) Return on equity (ROE) Formula Required #11. (2pts) Current Ratio Formula Required 112. 2pts) Debt Ratio Formula Required #13. (2 pts) Profit Margin Formula Required 54 55 56 57
Expert Solution
ROA is computed as follows:
= Net Income / Total Assets
= $ 725 / $ 2,050
= 35.37%
ROE is computed as follows:
= Net Income / Equity
= $ 725 / $ 736
= 98.51%
Current ratio is computed as follows:
= Current Assets / Current Liabilities
= $ 720 / $ 449
= 1.60
Debt ratio is computed as follows:
= Total Liabilities / Total Assets
= $ 1,314 / $ 2,050
= 0.64 Approximately
Profit margin is computed as follows:
= Net Income / Net Revenue
= $ 725 / $ 5750
= 12.61%
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