Solution-Calculate the operating profit of the current year

Calculate the operating profit of the current year

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Reference no: EM133054396

Question - Alitalia limited is a private company which is trying to evaluate the financial performance of the company. The management accounting department advised the management to use Return on Investment to carry out the exercise. Table below provides the data that could be used for the analysis

Data items	$
Cash	2,500
Account receivable	17,560
Inventory	20,800
Plant	110,000
Property	75,000
Equipment	45,000
Accumulated Depreciation- Equipment	32,000
Sales	280,000
Cogs	110,000
Operating expenses	50,000
Unearned Revenue	35,300
Accrued expense	10,000
Tax	18%
Operating Assets of last year	$250,000

REQUIRED -

1. Calculate the operating profit (EBIT) of the current year.

2. Calculate the operating assets of the current year.

3. Calculate the Average Operating Assets.

4. Calculate the ROI using the information on the table.

5. Find ROI using the two component method.

Reference no: EM133054396

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Calculate the operating profit of the current year

Reference no: EM133054396

Reference no: EM133054396

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