The financial statements of Farmer Corporation follow: (Click the icon to view the assets section of the balance sheet.) (Click the icon to view the liabilities and stockholders' equity sections of the balance sheet.) (Click the icon to view the income statement.) Calculate these profitability measures for 2018. Show each computation. a. Rate of return on sales. b. Asset turnover ratio. c. Rate of return on total assets. d. Leverage (equity multiplier) ratio. e. Rate of return on common stockholders' equity. f. Is Farmer's profitability strong, medium, or weak? a. Compute the rate of return on sales for 2018. (Enter currency amounts in millions as given in the question. Ignore interest expense in your analysis and enter "O" for any zero balances. Round your answer to the nearest tenth of a percent, X.X%.) Rate of return on sales )/ % 11 Choose from any list or enter any number in the input fields and then click Check Answer. 5 parts remaining Clearly Check Answer Farmer Corportion Balance Sheets (Adapted) December 31, 2018 and 2017 Increase (Decrease) Amount Percentage (Dollar amounts in millions) 2018 2017 1,220 $ 930 $ 290 31.2 % Assets Current assets: Cash and cash equivalents Short-term investments Receivables, net Inventories 15 65 220 312 (50) (92) 62 (40) (76.9) (29.5) 103.3 122 284 60 324 Prepaid expenses and other assets (123) Total current assets 1,861 1.691 170 10.1 Property, plant, and equipment, not 4,548 3,330 1,218 36.6 Print Done 1 Data Table Increase (Decrease) (Dollar amounts in millions) 2018 2017 Amount Percentage Assets Current assets: 1,220 $ 930 $ 290 31.2 % 15 65 220 312 Cash and cash equivalents Short-term investments Receivables, net Inventories Prepaid expenses and other assets Total current assets Property, plant, and equipment, net Intangible assets (50) (92) 62 (40) (76.9) (29.5) 103.3 122 284 60 324 (12.3) 1,861 1,691 170 10.1 4,548 3,330 1,218 36.6 888 16.0 1,030 820 142 50 770 Other assets 6.5 $ 8,259 $ 6,679 $ 1,580 Total assets 23.7 % 12 Print nana Farmer Corporation Balance Sheet (Adpated) December 31, 2018 and 2017 Increase (Decrease) Amount Percentage 2018 2017 Dollar amounts in millions) Liabilities and Stockholders' Equity 950 $ 870 $ 80 9.2 % Current liabilities: Accounts payable Income tax payable Short-term debt 40 70 (42.9) 105 (30) 25 (5) 130 75 23.8 Other 80 (6.3) 1,195 1,125 70 6.2 Total current liabilities Long-term debt Other liabilities 45.9 4,556 1,120 3,122 1,020 1,434 100 9.8 Print Done 40 70 Income tax payable (30) (42.9) 25 23.8 Short-term debt 130 75 105 80 (5) (6.3) Other 1,195 1,125 70 6.2 Total current liabilities 45.9 Long-term debt 4,556 1,120 3,122 1,020 1,434 100 9.8 Other liabilities 6,871 5,267 1,604 30.5 Total liabilities Stockholders' equity: 2 Common stock Retained earnings 2. 1,516 (130) (5.3) 1,600 (190) (84) 60 31.6 1,388 1,412 (24) (1.7) Accumulated other comprehensive (loss) Total stockholders' equity Total liabilities and stockholders' equity $ 8,259 $ 6,679 $ 1,580 23.7 % Farmer Corporation Statements of Income (Adapted) Year Ended December 31, 2018 and 2017 hui (Dollar amounts in millions) 2018 2017 Net revenues 9,310 $ 4,550 9,150 4,800 tion Cost of goods sold Gross profit General and administrative expenses Income from operations 4,760 3,200 4,350 3,400 on 950 1,560 195 150 % Interest expense, net Income before income taxes 1,365 434 800 270 Provision for income taxes $ 931 $ 530 Net Income