ols le Ch 04- Assignment - Analysis of Financial Statements Calculate the profitability ratios of Stay Swift Corp. in the following table. Convert all calculations to a percentage rounded to two decimal places. Ratio Operating margin Profit margin Return on total assets Return on common equity Basic earning power Value Year 2 21.97% 14.25% 4.82% 14.48% 7.42% Year 1 9.85% 6.40% 2.72% 5.12% 4.19% Decision makers and analysts look deeply into profitability ratios to identify trends in a company's profitability. Profitability ratios give insights into both the survivability of a company and the benefits that shareholders receive. Identify which of the following statements are true about profitability ratios. Check all that apply. If a company has a profit margin of 10%, it means that the company earned a net income of $0.10 for each dollar of sales. If a company's operating margin increases but its profit margin decreases, it could mean that the company paid more in interest or taxes. An increase in a company's earnings means that the profit margin is increasing.

Decision makeis and analysts look deeply into profiablity ratios to identify trends in a companys proficabinty. Profiability taulos give insighte into both the survivability of a company and the benefits that sharehoiders receive. Identify which of the following statements are true about proficabinty ratios, check all that apply: If a company has a pront margin of 10%, it means that the company earned a net income of s0.10 for each doliar of ales If a companys operating margin increases but its profit margin decreases, is could inean that the company paid more in interest or tasr An increase in a companyls earnings means that the profit margin is increasing. Decision makeis and analysts look deeply into profiablity ratios to identify trends in a companys proficabinty. Profiability taulos give insighte into both the survivability of a company and the benefits that sharehoiders receive. Identify which of the following statements are true about proficabinty ratios, check all that apply: If a company has a pront margin of 10%, it means that the company earned a net income of s0.10 for each doliar of ales If a companys operating margin increases but its profit margin decreases, is could inean that the company paid more in interest or tasr An increase in a companyls earnings means that the profit margin is increasing