An efficiency ratio known as the capital intensity ratio provides valuable insight into a company's financial situation.
Capital Intensity Ratio = Total Assets/Total Revenue
Return on assets = Net income/Total Assets
Total Assets = Net income/Return on Assets= $389,100/0.086
Total Revenue = Net income/Net Profit Margin = $389,100/0.028
Capital intensity ratio = ($389,100 /0.086) / ($389,100 / 0.028) =0.33
This ratio reveals how much capital or other resources a company has to have in order to make single dollar in sales. This ratio is the inverse of the asset turnover ratio, making it simple to calculate the capital intensity ratio if you already know the asset turnover ratio. For all capital-intensive firms, we require a good or higher capital intensity ratio. A company that invests a significant amount of capital in its manufacturing process is said to be capital-intensive. E.g., Power generating facilities. A company that has made significant investments in assets to generate income has a high capital intensity ratio (CIR). A company with a low CIR is able to produce larger revenues while owning fewer assets. As a result, businesses can use this ratio to modify their capital budgeting and planning.
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Answer:
D. $42,000 should be debited to Land Improvements
Explanation:
The cost of the land housing the parking is recorded in the land account. Other costs such as paving cost and lights are improvements and as such are added and recorded in the Land Improvements accounts.
Total Land improvements = $30,000 + $12,000
= $42,000
The right answer is D. $42,000 should be debited to Land Improvements.
Answer:
The correct answer is option a.
Explanation:
The bureau of labor statistics calculates the data regarding the unemployment rate in the US economy. It calculates the unemployment rate as the ratio of total unemployed to the total labor force.
Those people who are having a job or business and are working for profit or those who are currently unemployed and looking for jobs are included in the labor force. Students, retirees, and discouraged workers are not included in the labor force.
Here, Christopher is neither working for profit nor looking for work so he will not be considered unemployed or in labor force.