Reference no: EM133065041
Question - Aloe Vera 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 24,500
Account receivable 10,560
Inventory 7,800
Plant 150,000
Property 280,000
Land for speculation 120,500
Equipment 65,000
Accumulated Depreciation- Equipment 22,000
Sales 325,000
Sales Discount 1200
Cogs 110,000
Operating expenses 60,000
Unearned Revenue 15,300
Prepaid expense 8,000
Accrued Expense 7600
Tax 15%
Operating Assets of last year $510,000
Required -
1. Calculate the operating profit (EBIT) of the current year.
2. Calculate the net income.
3. Find the ROI for this investment.
4. What are the margin and the turnover of this investment.
5. Use the margin and the turnover to calculate the ROI.