Question
The following financial details are provided for the Garcia Division of NOP Corporation for the year ended December 31, Year 16: Garcia Division Income Statement
The following financial details are provided for the Garcia Division of NOP Corporation for the year ended December 31, Year 16:
Garcia Division Income Statement
Description | Amount ($) |
Sales revenue | 1,550,600 |
Cost of goods sold | 940,500 |
Gross margin | 610,100 |
Operating expenses | 385,500 |
Depreciation expense | 80,700 |
Operating income | 143,900 |
Nonoperating items | 53,200 |
Loss on sale of equipment | (18,300) |
Net income | 178,800 |
Garcia Division Balance Sheet
Assets | Amount ($) |
Cash | 155,300 |
Accounts receivable | 320,400 |
Merchandise inventory | 260,300 |
Equipment less accumulated depreciation | 420,000 |
Total assets | 1,155,900 |
Liabilities and Stockholders' Equity | Amount ($) |
Accounts payable | 220,200 |
Notes payable | 98,400 |
Stockholders' equity | 837,300 |
Total liabilities and stockholders' equity | 1,155,900 |
Required:
- Calculate the gross margin ratio for Garcia Division.
- Determine the return on assets (ROA) for Garcia Division.
- Compute the current ratio for Garcia Division.
- Evaluate the debt to equity ratio for Garcia Division.
- Assess the Garcia Division’s operating margin.
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