PLEASE SHOW ALL WORK AND EXPNATIONS

THIS IS AN EXAMPL OF ANSWER FORMAT , NUMBERS ARE NOT REAL !!!!!

Requirement 1. Calculate the company's ROI.

Operating income	/	Average total assets	=	ROI
$ 100,000	/	$ 500,000	=	20	%

Requirement 2. Calculate the company's profit margin ratio

Operating income	/	Net sales revenue	=	Profit margin ratio
$ 100,000	/	$ 2,000,000	=	5	%

Freedom, Inc. is earning $

0.05

(=5% x $1.00) of operating income on each dollar of sales.

Requirement 3. Calculate the company's asset turnover ratioNow calculate the asset turnover ratio.

Net sales revenue	/	Average total assets	=	Asset turnover ratio
$ 2,000,000	/	$ 500,000	=	4

The company's asset turnover ratio explains how efficiently a company uses its average total assets to generate sales. The
company is generating $	4	(=4 x $1.00) of sales with every dollar of average total assets.

Requirement 4. Use the expanded ROI formula to confirm your results from Requirement 1. Interpret your results.

driving a division's ROI, management often restates the ROI equation in its expanded form:

Operating income	x	Net sales revenue	=	ROI
Net sales revenue		Average total assets

Using the expanded formula, calculate the ROI for the company.

Profit Margin		x	Asset Turnover	=	ROI
5	%	x	4	=	20	%

Review your answer with the basic ROI you calculated in Requirement 1. Do they agree?

Requirement 5. Calculate the company's RI. Interpret your results.

Freedom, Inc. (Enter the target rate as a percentage.)

	Operating income		(	Average total assets	x	Target rate of return		)	=	RI
	$ 100,000		(	$ 500,000	x	10	%	)	=	$ 50,000

P24-21A (similar to) Question Help Consider the following condensed financial statements of Money Safe, Inc. The company's target rate of return is 30%: (Click the icon to view the comparative balance sheet.) (Click the icon to view the income statement.) Read the requirements. Requirement 1. Calculate the company's ROI. Round all of your answers to four decimal places. Begin by selecting the formula to calculate return on investment (ROI), and then enter the amounts to calculate the company's ROI. (Round your calculations to four decimal places and enter your final to the nearest hundredth of a percent, X.XX%) ROI II % Choose from any list or enter any number in the input fields and then click Check Answer. ? 10 parts parts remaining Clear All Check Answer Money Safe, Inc. Comparative Balance Sheet As of December 31, 2018 and 2017 2018 2017 Assets Cash $ 76,000 $ 62,000 Accounts Receivable 61,400 26,800 600 200 Supplies Property, Plant, and Equipment, net 305,000 163,000 204,000 101,000 Patents, net $ 606,000 $ 394,000 T_I_LA...t. Property, Plant, and Equipment, net 305,000 204,000 163,000 Patents, net 101,000 $ 606,000 $ 394,000 Total Assets Liabilities and Stockholders' Equity Accounts Payable $ 29,000 $ 31,000 Short-term Notes Payable 148,000 52,000 Long-term Notes Payable 196,000 126,500 Common Stock, no Par 169,000 205,500 27,500 Retained Earnings 15,500 Total Liabilities and Stockholders' Equity $ 606,000 $ 394,000 For the Year Ended December 31, 2018 Net Sales Revenue $ 6,000,000 3,700,000 Cost of Goods Sold Gross Profit 2,300,000 2,000,000 Operating Expenses Operating Income 300,000 Other Income and (Expenses): Interest Expense (34,000) Income Before Income Tax Expense 266,000 93,100 Income Tax Expense $ 172,900 Net Income 1. 2. 3. Calculate the company's ROI. Round all of your answers to four decimal places. Calculate the company's profit margin ratio. Interpret your results. Calculate the company's asset turnover ratio. Interpret your results. Use the expanded ROI formula to confirm your results from Requirement 1. Interpret your results. Calculate the company's RI. Interpret your results. 4. 5