Question
Here are the financial statements for the Brown Division of EFG Corporation for the year ended December 31, Year 13: Brown Division Income Statement Description
Here are the financial statements for the Brown Division of EFG Corporation for the year ended December 31, Year 13:
Brown Division Income Statement
Description | Amount ($) |
Sales revenue | 1,250,900 |
Cost of goods sold | 710,500 |
Gross margin | 540,400 |
Operating expenses | 300,500 |
Depreciation expense | 65,700 |
Operating income | 174,200 |
Nonoperating items | 38,400 |
Gain on sale of investments | 13,200 |
Net income | 225,800 |
Brown Division Balance Sheet
Assets | Amount ($) |
Cash | 110,200 |
Accounts receivable | 255,400 |
Merchandise inventory | 215,300 |
Equipment less accumulated depreciation | 340,000 |
Total assets | 921,100 |
Liabilities and Stockholders' Equity | Amount ($) |
Accounts payable | 165,200 |
Notes payable | 75,400 |
Stockholders' equity | 680,500 |
Total liabilities and stockholders' equity | 921,100 |
Required:
- Calculate the net profit margin for Brown Division.
- Determine the return on equity (ROE) for Brown Division.
- Compute the quick ratio for Brown Division.
- Evaluate the interest coverage ratio for Brown Division.
- Assess the Brown Division’s debt to total assets ratio.
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