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Below are the financial details for Ford Motor Company's Automotive Division for the fiscal year ending December 31, Year 13: Income Statement: Sales revenue: $7,000,000
Below are the financial details for Ford Motor Company's Automotive Division for the fiscal year ending December 31, Year 13:
Income Statement:
- Sales revenue: $7,000,000
- Cost of sales: $4,500,000
- Gross profit: $2,500,000
- Operating expenses: $1,000,000
- Depreciation: $500,000
- Operating income: $1,000,000
- Interest expense: $200,000
- Loss on sale of assets: $100,000
- Net income: $700,000
Balance Sheet:
- Cash: $500,000
- Accounts receivable: $800,000
- Inventory: $900,000
- Property, plant, and equipment (net): $1,300,000
- Total assets: $3,500,000
- Accounts payable: $600,000
- Long-term debt: $800,000
- Stockholders' equity: $2,100,000
- Total liabilities and equity: $3,500,000
Requirements:
- Compute the ROI for Ford Motor Company's Automotive Division.
- Analyze the gross profit margin.
- Determine the impact of interest expense on net income.
- Calculate the current ratio.
- Discuss the significance of the loss on sale of assets.
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