Answer:
Crafty Crafts:
Return on Assets Ratio = Net Income/Average Assets x 100
= $1,040/46,350 x 100
= 2.2%
Explanation:
 a) Data
                                        Crafty Crafts          Hobbies, Inc. 
Total liabilities, 2016            $31,957               $25,461 
Total liabilities, 2015              36,104                 30,046 
Total assets, 2016                 46,186                 32,872 
Total assets, 2015                 46,514                 35,208 
Net sales, 2016                    161,466                  81,702
Net income, 2016                    1,040                    1,766
b) Average Assets:
Crafty Crafts = (2016 + 2015 assets)/2 = ($46,186 + 46,514)/2 = $46,350
c) The Return on Assets Ratio: This financial performance ratio shows how much of the earnings is generated from the assets of the company in a particular period.  It shows the efficiency of management to generate profit from the assets.  Usually, the average assets value is used to even the variations over the period.