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Problem - Ratio of net sales to assets
The following financial statement data for years ending December 31 for Foodworks Company are shown below.
2012
2011
Net sales
$880,000
$787,500
Total assets:
Beginning of year
500,000
375,000
End of year
600,000
Required -
a. Determine the ratio of net sales to assets for 2012 and 2011.
b. Does the change in the ratio of net sales to assets from 2011 to 2012 indicate a favorable or an unfavorable trend?
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