The Net Farm Income From Operations is $90,250 The Adjusted Net Farm Income from Operations is $101,350. The Net Farm Income is $101,350. Calculation of the Return to Labor and Management: Return to Management: Adjust NFIO = \$90,250 + \$31,000 = \$121,250 R.L.&M. = \$121,250-(\$785,000 * 0.09) = \$50,600 R.M. = \$50,600 - \$24,000 = \$26,600 Return to Labor: R.L. = \$50,600 - \$12,000 = \$38,600

Please answer the following:

1. Compute Return on Assets Ratio in % 2. COmpute return on equity ratio in % 3. What is the operating profit margin ratio? 4. Compute the Asset Turnover Ratio. What does this value mean? How do you interpret it? Please explain the answers, thanks!

Assume Stan Farms has an accounting period running from January 1 to December 31. Use the following information obtained for the pa income statement for Stan Farms using the attached form. st calendar year accounting period to complete an Inventory Values January 1 $32,850 $18,600 ece Crops Livestock $25,440 $31,500 Revenue and Expenses $189,600 3,800 Depreciation Feed Purchased Property Taxes Misc. Expenses Market Livestock Sold Repairs Fertilizer Exp. Supplies Labor Hired Fuel Expense 28,900 21,200 3,400 5,800 91,660 12,100 Crops Sold Insurance Interest Paid Feeder Livestock Purch. Seed Purchased Vet. & Health Expense Income from Custom Work Gain on Sale of 33,400 46,500 6,410 4,800 4,700 9,400 4,800 7,600 Breeding Stock Gov't payment income Chemical exp 22,600 8,890 9,780 5,800 Gain on mach. sale 11,100 Change in interest payable (2400) Change in acct. payable +1,400 Other Information Family Living Expenses Income Tax Paid $ 38,000 10,700 $785,000 Average Asset Value (2007) Opportunity Cost of Operator 24,000 Owner's Equity (12/31) $402,000 Labor $349,350 Owner's Equity (01/01) Opportunity Cost of Operator 12,000 9% Management Opportunity Cost of Capital