Reference no: EM132490816

Down Inc. operates a large quarry in Central BC. Selected data from Down Inc. for the year ended December 31, 2018 are presented below:

Total assets                                                                                       $1,600,000
Average total assets                                                                             1,500,000
Net earnings                                                                                           123,200
Net sales                                                                                               1,200,000
Average common shareholders' equity Net cash provided by operating activities     1,000,000

                                                                                                                 280,000
Required:

Question 1: Calculate the profit margin and return on equity for Down's for the year ended December 31, 2018.

Question 2: Comment on the ratios you prepared in part 1 by comparing your ratios to the following averages in the industry: Profit Margin: 5% Return on Equity 7%