Key Ratio Exercises Sensations Confections, Inc. Consolidated Income Statement (in millions) Income $1000 Gross Sales Less: COGS 200 Net Sales $800 $10 Expenses Less: General and Administrative Less: Salaries and Wages Loss: Equipment Rentals Less: Fuel 250 120 150 150 Loss: Materials and Supplies Less: Interest 50 50 Less: Other Total Operating Expenses Net Income Boforo Taxes $780 $20 1. Calculate the current return on sales (ROS) using the Sensations Confections, Inc. Consolidated Income Statement 2. Assume a company has $400,000 net income after tax (NIAT) and $1 million in assets. Through your value solution they are able to sell of $200,000 worth of assets without any negative impact on sales and income. Calculate the return on assets before and after the solution 3. Assume annual cost of goods sold (COGS) is $1 million and the average inventory value is $200,000 calculate the inventory turns. 4. Assume your value solution reduces your customer's average inventory levels to $166,000 when you deliver inventory to your customer on a more frequent basis and the annual cost of goods sold remains at $1 million. Recalculate the turns based on $166,000. 5. Calculate the percentage increase in turns from the scenario in question #3 to question #4 above