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Data from the financial statements of Oriental Candle Company included the following: (Click the icon to view the data.) Read the requirements. Requirements 1.
Data from the financial statements of Oriental Candle Company included the following: (Click the icon to view the data.) Read the requirements. Requirements 1. Calculate the following ratios: a. Net profit margin; b. Asset turnover ratio; c. Leverage ratio; d. Return on assets (ROA); e. Return on equity (ROE). a. Begin by selecting the formula labels and then enter the amounts to calculate net profit margin. (Round your answer to one decimal place, X.X%.) Net profit margin ratio % b. Select the formula labels and then enter the amounts to calculate the asset turnover ratio. (Round your answer to one decimal place, X.X.) Asset turnover ratio Data table c. Select the formula labels and then enter the amounts to calculate the leverage ratio. (Round your answer to one decimal place, X.X.) Leverage ratio Average total assets $ 50,000 Average common stockholders' equity Net sales 25,000 250,000 11,000 d. Select the formula labels and then enter the amounts to calculate return on assets (ROA). (Round your answer to one decimal place, X.X%.) Net income The company had no preferred stock. ROA % e. Select the formula labels and then enter the amounts to calculate return on equity (ROE). (Round your answer to one decimal place, X.X%.) ROE % Requirement 2. Which is higher, ROA or ROE? Does this make sense for stockholders? Why or why not? Both ROA and ROE are Shareholders prefer a return on equity than return on assets. Shareholders should be with this return. Print Done
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