Reference no: EM132553521
Problem 1: Use the information provided to analyze the profitability of SDHS Co using the following ratios: return on assets
Sales$ 350,000
Gross profit206,500
Net income115,000
Interest expense2,875
Average total assets875,000
Average total shareholders' equity500,000
Weighted-average common shares outstanding25,000
The return on assets is
13%
13.5%
14%
14.5%
Problem 2: Use the information provided to analyze the profitability of SDHS Co using the following ratios: return on equity
Sales$ 350,000
Gross profit206,500
Net income115,000
Interest expense2,875
Average total assets875,000
Average total shareholders' equity500,000
Weighted-average common shares outstanding25,000
The return on equity is
21%
23%
27%
35%
Problem 3: Use the information provided to analyze the profitability of SDHS Co using the following ratios: gross profit ratio
Sales$ 350,000 Gross profit206,500 Net income115,000 Interest expense2,875 Average total assets875,000 Average total shareholders' equity500,000 Weighted-average common shares outstanding25,000
The gross profit ratio is
45%
50%
59%
65%
Problem 4: Use the information provided to analyze the profitability of SDHS Co using the following ratios: earnings per share. SDHS Co has no preferred stock.
Sales$ 350,000 Gross profit206,500 Net income115,000 Interest expense2,875 Average total assets875,000 Average total shareholders' equity500,000 Weighted-average common shares outstanding25,000
The earnings per share is
$3.60
$4.60
$5.60
$6.60