7.) The 2024 income statement of Adrian Express reports sales of $19,910,000, cost of goods sold of $12,400,000, and net income of $1,820,000. Balance sheet information is provided in the following table.

ADRIAN EXPRESS
Balance Sheets
December 31, 2024 and 2023
	2024	2023
Assets
Current assets:
Cash	$760,000	$890,000
Accounts receivable	1,675,000	1,145,000
Inventory	2,105,000	1,575,000
Long-term assets	4,960,000	4,370,000
Total assets	$9,500,000	$7,980,000
Liabilities and Stockholders' Equity
Current liabilities	$1,986,000	$1,796,000
Long-term liabilities	2,454,000	2,536,000
Common stock	1,975,000	1,945,000
Retained earnings	3,085,000	1,703,000
Total liabilities and stockholders' equity	$9,500,000	$7,980,000

Industry averages for the following four risk ratios are as follows:

Gross profit ratio	45%
Return on assets	25%
Profit margin	15%
Asset turnover	4.5	times
Return on equity	35%

Required: 1. Calculate the five profitability ratios listed above for Adrian Express. 2. Do you think the company is more profitable or less profitable than the industry average?

1.

Calculate the five profitability ratios listed above for Adrian Express. (Round your answers to 1 decimal place.)

Profitability Ratios
Gross profit ratio		%
Return on assets		%
Profit margin		%
Asset turnover		times
Return on equity		%

2.

Do you think the company is more profitable or less profitable than the industry average?