F your own idea,why does a business exist.?

Financial data for Joel de Paris, Inc., for last year follow:

suter [353]

Answer:

profit margin: 7.09%

Turnover:

Assets : 1.85

Account Receivable: 11.53

Inventory: 9.05

ROI: 28.94%

2.- residual income 91,395

Explanation:

sales 4,700,000

net income 333,000

profit margin:

net income / sales

333,000 / 4,700,000 = 0,070851 = 7.09%

Turnovers:

Will be sales over an asset account to calcualte how many times the assets converts to cash or rotate.

the average will be calcualte as (beginning + ending)/2

Assets turnover:

sales/average assets

sales 4,700,000

(2,505,000 + 2,585,000) / 2 = 2,545,000

Ratio: 1,8467 = 1.85

Account Receivable Turnover:

sales/ average turnover

sales 4,700,000

(344,000 +471,000)/2 = 407,500

Ratio: 11,5337 = 11.53

Inventory Turnover

Sales/ average inventory

Sales 4,700,000

(568,000 + 471,000)/2 = 519,500

Inventory turnover: 9,04716 = 9.05

ROI

net income / average equity

where:

average equity : (beginning + ending)/2

1,092,000 + 1,209,000 = 1,150,500

333,000/1,150,500 = 0,28943

Residual income:

net income - Equity x expected return

333,000 - 1,150,500 x 0.21 =

333,000 - 241,605‬ = 91,395

5 0

3 years ago

What is the impact on the total asset turnover ratio if sales increase significantly while there is no change in any of the othe

Ostrovityanka [42]

Answer:

The total turnover increases

Explanation:

Asset Turnover Ratio is a measure of how efficient the assets of a company is when compared with the company's sales or revenue. To calculate Asset turnover ration, the net sales is set as a percentage of the company's total assets.

The higher the turnover of the asset based on the calculation then the higher the chances that organisation is generating revenue efficiently from its assets. A lower turnover however is the implication that the company is not efficiently using its assets and it could imply some internal issues.

Therefore, the higher the sales without any change in assets means the Asset Turnover will increase or be higher and it will indicate higher efficiency

4 0

3 years ago

Kreter, Inc. earned net income of $300,000 last year. This year it wants to earn net income of $450,000. The company's fixed cos

Minchanka [31]

Answer:

sales is $2,500,000

Explanation:

The target sales for the company to achieve a net income of $450,000 in the current year equals the net income plus variable cost plus the fixed costs.

To understand this better,let us use the net income formula:

net income=sales-variable costs-fixed costs

by changing the subject of the formula,we the formula for sales:

sales=net income+variable costs+fixed costs

variable costs=sales*70%=0.7 sales

sales=$450,000+$300,000+0.7 sales

sales-0.7 sales=$750,000

0.3 sales=$750,000

sales=$750,000/0.3=$2,500,000

8 0

3 years ago

at the end of the current year, using the aging of accounts receivable method, management estimated that $16,500 of the accounts

Furkat [3]

The adjusting entry that the company should pass at the end of the current year to record the bad debts expense:

Bad Debts Expense 16,900

Allowance for Doubtful Accounts 16,900

<h3>What is an allowance for doubtful accounts?</h3>

A contra account called an allowance for doubtful accounts nets against the total receivables shown on the balance sheet to only show the amounts anticipated to be paid. The percentage of accounts receivable that are anticipated to be uncollectible is estimated by the allowance for doubtful accounts.

A negative balance in the allowance for doubtful accounts means that more accounts than anticipated have been written off. A contra asset account with a typical credit balance is the allowance for doubtful accounts.

Under the aging method, the adjusting entry for bad debt expense is calculated using the following formula:

Estimate of uncollectible accounts - (+) Current credit (debit) balance in the allowance for doubtful accounts = Bad debt expense

Hence, The adjusting entry that the company should pass at the end of the current year to record the bad debts expense is given above.

Learn more about the allowance for doubtful accounts:

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"Your question is incomplete, probably the complete question/missing part is:"

Bad Debts Expense 16,500

Allowance for Doubtful Accounts 16,500

Bad Debts Expense 16,100

Allowance for Doubtful Accounts 16,100

Bad Debts Expense 16,900

Allowance for Doubtful Accounts 16,900

Accounts Receivable 16,500

Bad Debts Expense 400

Sales 16,900

Accounts Receivable 16,900

Allowance for Doubtful Accounts 16,900

8 0

1 year ago

This year, Mesa Inc.’s before-tax income was $11,252,000. It paid $529,000 income tax to Minnesota and $451,000 income tax to Il

Sever21 [200]

Answer:

Before-tax income $ 11,252,000

Less: Deduction for state income tax(529000+451000) $ 980,000

Taxable Income $ 10,272,500

Tax rate 21%

Federal income tax $ 2,157,225.00

Mesa’s combined tax rate

= ([$980,000 state tax + $2,157,225 federal tax] ÷ $11252000) 27.88%

Explanation:

6 0

3 years ago

F your own idea,why does a business exist.?​

F your own idea,why does a business exist.?