(SOLVED) following figures have been extracted from the financial statements of a company. Non-current assets £80 million Current assets £40 million

Discipline: Finance

Type of Paper: Question-Answer

Academic Level: Undergrad. (yrs 1-2)

Paper Format: APA

Pages: 1 Words: 262

Question

The following figures have been extracted from the financial statements of a company.


Non-current assets £80 million
Current assets £40 million


Current liabilities £20 million
Sales  £200 million
Cost of goods sold £75 million
Operating expenses £45 million


Calculate the following financial ratios:

a. Total net asset turnover ratio

b. EBIT percentage


c. ROTNA


Expert Solution Preview


a. Total net asset turn over ratio:

Total net asset turnover ratio is calculated to determine the efficiency of the company's sales with respect to its assets in a year.


Total net asset turnover ratio = Net sales / Total assets

Total assets = Current assets + Non current assets

- 40+80

= 120

Total net asset turnover ratio = 200/120

= 1.66


Answer:

Total net asset turnover ratio is 1.66


b. EBIT Percentage:.......