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Compute the return on assets for times mirror

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Reference no: EM132816720

Using the income statement for Times Mirror and Glass Co., compute the following ratios:

TIMES MIRROR AND GLASS COMPANY

Sales....................................................................$235,000

Cost of goods sold ............................................121,000

Gross profit.........................................................$114,000

Selling and administrative expense.............47,500

Lease expense ......................................................15,000

Operating profit*.................................................$51,500

Interest expense......................................................6,900

Earnings before taxes.....................................$44,600

Taxes (30%)..............................................................17,840

Earnings after taxes.........................................$26,760

Equals income before interest and taxes.

Problem a. Compute the interest coverage ratio. (Round your answer to 2 decimal places.)

Problem b. Compute the fixed charge coverage ratio.(Round your answer to 2 decimal places.)

The total assets for this company equal $182,000. Set up the equation for the Du Pont system of ratio analysis.

Problem c. Compute the profit margin ratio.(Input your answer as a percent rounded to 2 decimal places.)

Problem d. Compute the total asset turnover ratio.(Round your answer to 2 decimal places.)

Problem e. Compute the return on assets (investment).(Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.)

Reference no: EM132816720

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