Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Assume the average cost of computer equipment fell 20.9 percent between 2010 and 2011. Let's see whether these changes are reflected in the income statement
Assume the average cost of computer equipment fell 20.9 percent between 2010 and 2011. Let's see whether these changes are reflected in the income statement of Computer Tycoon Inc. for the year ended December 31,2011. Required: 1-a. Compute the gross profit percentage for each year. (Round your answers to 1 decimal place.) 1-b. Is there an increase or decrease in the gross profit ratio? Increase Decrease 2-a. Compute the net profit margin for each year. (Round your answers to 1 decimal place.) 2-b. Is there an increase or decrease in the net profit margin? Increase Decrease 3-a. Computer Tycoon reported average net fixed assets of $55,200 in 2011 and $49,100 in 2010. Compute the fixed asset turnover ratios for both years. (Round your answers to 2 decimal places.) 3-b. In which year did the company better utilize its investment in fixed assets to generate revenues in 2011 or 2010? 2011 2010 4-a. Computer Tycoon reported average shareholders' equity of $55,000 in 2011 and $41,800 in 2010. Compute the return on equity ratios for both years. (Round your answers to 1 decimal place.) 4-b. In which year did the company generate greater returns for stockholders
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started