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Orca Industries Below are the two most recent balance sheets and most recent income statement for Orca Industries. The company has an effective tax rate of 35%  Balance Sheet 20112010 Assets:  Cash$10,000$6,000 Accounts Receivable (net) 6,0001,500 Inventory 8,00010,000 Long-lived assets12,00011,000 Less: Accumulated depreciation (4,000) ‾(2,000) ‾ Total assets $32,000‾$26,500‾ Liabilities and Stockholders’ Equity: Accounts payable $5,000$6,000 Deferred revenues 1,0002,000 Long-term note payable 10,00010,000 Less: Discount on note payable(800) (1,000) Common stock 12,0006,000 Retained earnings4,800‾$3,500‾Total liabilities and stockholders’ equity $32,000‾$26,500‾ Income Statement For the year ended December 31, 2011  Revenues$42,000 Cost of goods sold (24,000)  Depreciation expense(2,000)  Interest expense (3,000)  Bad debt expense(2,000)  Other expense (including income taxes)  (9,000) ‾ Net income $2,000‾\begin{array}{llcc}\text { Balance Sheet }&2011&2010 \\ \text { Assets: } &\\ \text { Cash} &\$10,000&\$6,000\\ \text { Accounts Receivable (net) } &6,000&1,500\\ \text { Inventory } &8,000&10,000\\ \text { Long-lived assets} &12,000&11,000\\ \text { Less: Accumulated depreciation } &\underline{(4,000) }&\underline{(2,000) } \\ \text { Total assets } &\underline{\$32,000}&\underline{\$26,500}\\\\ \text { Liabilities and Stockholders' Equity: } &\\ \text {Accounts payable } &\$5,000&\$6,000\\ \text { Deferred revenues } &1,000&2,000\\ \text { Long-term note payable } &10,000&10,000\\ \text { Less: Discount on note payable} & (800) &(1,000) \\ \text {Common stock } &12,000&6,000\\ \text { Retained earnings} &\underline{4,800}&\underline{\$3,500}\\ \text {Total liabilities and stockholders' equity } &\underline{\$32,000}&\underline{\$26,500}\\\\ \text { Income Statement} &\\ \text { For the year ended December 31, 2011 } &\\ \text { Revenues} &&\$42,000\\ \text { Cost of goods sold } &&(24,000) \\ \text { Depreciation expense} &&(2,000) \\ \text { Interest expense } &&(3,000) \\ \text { Bad debt expense} &&(2,000) \\ \text { Other expense (including income taxes) }& &\underline{(9,000) }\\ \text { Net income } &&\underline{\$2,000}\\\end{array} - Refer to the information for Orca Industries. The return on common shareholders' equity for Orca Industries is


A) 15.2%
B) 13.5%
C) 10%
D) 11.9%

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Extreme Sports Company and All Sports Corporation. Below is financial information for two sporting goods retailers. Extreme Sports Company operates a retail business and franchising business. At the end 2011, Extreme Sports had 263 Company-owned and 120 franchise-operated retail stores. Extreme's stores are located in suburban, strip mall and regional mall locations, the company operates in 32 states. All Sports Corporation sells sporting goods and related products at over 2,500 Company-operated retail stores. Selected Data for All Sports and Extreme Sports (amounts in millions)  All Sports  Extreine Sport  Sales $5,320$1,344 Cost of GoodsSold 3,897887 Interest Expense 13843 Net Income 21233 Average Inventory 998286 Average Fixed Assets 1,163130 Average Total Assets 2,472662 Average Tax Rate 40%40%\begin{array}{lll}&\text { All Sports }&\text { Extreine Sport }\\\text { Sales } & \$ 5,320 & \$ 1,344 \\\text { Cost of GoodsSold } & 3,897 & 887 \\\text { Interest Expense } & 138 & 43 \\\text { Net Income } & 212 & 33 \\\text { Average Inventory } & 998 & 286 \\\text { Average Fixed Assets } & 1,163 & 130 \\\text { Average Total Assets } & 2,472 & 662 \\\text { Average Tax Rate } & 40 \% & 40 \%\end{array} Refer to the information for Extreme Sports Company and All Sports Corporation. Compute the return on assets for Extreme Sports


A) 3.2%
B) 5.0%
C) 8.9%
D) 1.1%

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Carl Industries has condensed balance sheets as shown: 201120102009 Assets:  Curent assets $55,000$56,500$70,000 Plant & equipment net 495,000410,000440,000 Intangible assets, net 20,00027,50040,000 Total assets $570,000$494,000$550,000 Liabilities & Stckckolders’ Equity:  Curent liabilities $40,000$35,000$32,500 Long term liabilities 395,000310,000375,000 Stoclcholders’ equity 135,000149,000142,500 Total liabilities & equity $570,000$494,000$550,000\begin{array}{|l|l|l|l|}\hline & 2011 & 2010 & 2009 \\\hline \text { Assets: } & & & \\\hline \text { Curent assets } & \$ 55,000 & \$ 56,500 & \$ 70,000 \\\hline \text { Plant \& equipment net } & 495,000 & 410,000 & 440,000 \\\hline \text { Intangible assets, net } & 20,000 & 27,500 & 40,000 \\\hline \text { Total assets }& \$ 570,000 & \$ 494,000 & \$ 550,000 \\\hline & & & \\\hline \text { Liabilities \& Stckckolders' Equity: } & & & \\\hline \text { Curent liabilities } & \$ 40,000 & \$ 35,000 & \$ 32,500 \\\hline \text { Long term liabilities } & 395,000 & 310,000 & 375,000 \\\hline \text { Stoclcholders' equity } & 135,000 & 149,000 & 142,500 \\\hline\text { Total liabilities \& equity }& \$ 570,000 & \$ 494,000 & \$ 550,000 \\\hline & & &\end{array} - Refer to the information for Carl Industries. In a common size balance sheet for 2009, total liabilities and equity are expressed as


A) 25.9%
B) 100%
C) 74.1%
D) 103.6%

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Ramos Company included the following information in its annual report: 201120102009 Sales $178,400$162,500$155,500 Cost of goods sold 115,000102,500100,000 Operating expenses 50,00050,00045,000 Net incoume 13,40010,00010,500\begin{array}{|l|l|l|l|}\hline & 2011 & 2010 & 2009 \\\hline \text { Sales } & \$ 178,400 & \$ 162,500 & \$ 155,500 \\\hline\text { Cost of goods sold } & 115,000 & 102,500 & 100,000 \\\hline\text { Operating expenses } & 50,000 & 50,000 & 45,000 \\\hline\text { Net incoume } & 13,400 & 10,000 & 10,500 \\\hline \end{array} - Refer to the information for Ramos Company. In a percentage change income statement over the period of 2009 to 2011, what is the change in net income?


A) 100%
B) 21.6%
C) 72.4%
D) 27.6%

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EPS is an ambiguous measure of profitability because it reflects operating performance in the numerator and ________________________________________ in the denominator.

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All else being equal, firms with high levels of ________________________________________ incur more risk in their operations and should earn higher rates of return.

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Net Devices Inc. The following balance sheets and income statements are for Net Devices Inc., a manufacturer of small electronic devices, including calculators, personal digital assistants and mp3 players. For purposes of these questions assume that the company has an effective tax rate of 35%. Net Devices Inc. The following balance sheets and income statements are for Net Devices Inc., a manufacturer of small electronic devices, including calculators, personal digital assistants and mp3 players. For purposes of these questions assume that the company has an effective tax rate of 35%. \text { INCOME STATEMENTS ( } \$ \text { in thousands) } \begin{array}{c} \begin{array}{lll} \text { Fiscal year end}\\ \text { Net sales}\\ \text { Cost of Goods Sold}\\ \text { Gross profit}\\ \\ \text { Selling, general \& admin. Exp.}\\ \text { Income before deprec. \& amort.}\\ \\ \text { Depreciation \& amortization}\\ \text { Interest expense}\\ \\ \text { Income before tax}\\ \text { Provision for income taxes}\\ \text { Minority interest}\\ \\ \text { Net income}\\ \\ \text { Outstanding shares (in thousands) }\\ \text { Preferred Dividends (in thousands) } \end{array} \begin{array}{l} 2011 \\ \$ 11,455,500 \\ \underline{(8.026 .450) }\\ {3,429,050} \\ \\ \underline{(1.836 .400) }\\ {1,592,650} \\ \\ (785,250) \\ \underline{(46.195) } \\ \\ 761,205 \\ (157,725) \\ \underline{\quad\quad-}\\ \\ \underline{\$603.480} \\ \\ 308,515 \\ \$ 85000 \\ \end{array} \begin{array}{l} 2010 \\ \$ 11,082,100 \\ \underline{(7.940 .065) }\\ {3,142,035} \\ \\ \underline{(1,789,200) }\\ {1,352,835} \\ \\ (757,250) \\ \underline{(43,340) }\\ \\ 552,245 \\ (112,290) \\ \underline{\quad\quad-}\\ \\ \underline{ \$ 439.955} \\ \\ 303,095 \\ \$ 85,000 \end{array} \end{array} - Refer to the information for Net Devices Inc. What is the accounts receivable turnover ratio for Net Devices for 2011? A) 24.65 B) 14.85 C) 14.81 D) 10.50  INCOME STATEMENTS ( $ in thousands)  \text { INCOME STATEMENTS ( } \$ \text { in thousands) }  Fiscal year end Net sales Cost of Goods Sold Gross profit Selling, general & admin. Exp. Income before deprec. & amort. Depreciation & amortization Interest expense Income before tax Provision for income taxes Minority interest Net income Outstanding shares (in thousands)  Preferred Dividends (in thousands) 2011$11,455,500(8.026.450) ‾3,429,050(1.836.400) ‾1,592,650(785,250) (46.195) ‾761,205(157,725) −‾$603.480‾308,515$850002010$11,082,100(7.940.065) ‾3,142,035(1,789,200) ‾1,352,835(757,250) (43,340) ‾552,245(112,290) −‾$439.955‾303,095$85,000\begin{array}{c}\begin{array}{lll} \text { Fiscal year end}\\ \text { Net sales}\\ \text { Cost of Goods Sold}\\ \text { Gross profit}\\\\ \text { Selling, general \& admin. Exp.}\\ \text { Income before deprec. \& amort.}\\\\ \text { Depreciation \& amortization}\\ \text { Interest expense}\\\\ \text { Income before tax}\\ \text { Provision for income taxes}\\ \text { Minority interest}\\\\ \text { Net income}\\\\ \text { Outstanding shares (in thousands) }\\ \text { Preferred Dividends (in thousands) }\end{array}\begin{array}{l}2011 \\\$ 11,455,500 \\\underline{(8.026 .450) }\\{3,429,050} \\\\\underline{(1.836 .400) }\\{1,592,650} \\\\(785,250) \\\underline{(46.195) } \\\\761,205 \\(157,725) \\\underline{\quad\quad-}\\\\\underline{\$603.480} \\\\308,515 \\\$ 85000 \\ \end{array}\begin{array}{l}2010 \\\$ 11,082,100 \\\underline{(7.940 .065) }\\{3,142,035} \\\\\underline{(1,789,200) }\\{1,352,835} \\\\(757,250) \\\underline{(43,340) }\\\\552,245 \\(112,290) \\\underline{\quad\quad-}\\\\\underline{ \$ 439.955} \\\\ 303,095 \\\$ 85,000 \end{array}\end{array} - Refer to the information for Net Devices Inc. What is the accounts receivable turnover ratio for Net Devices for 2011?


A) 24.65
B) 14.85
C) 14.81
D) 10.50

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Orca Industries Below are the two most recent balance sheets and most recent income statement for Orca Industries. The company has an effective tax rate of 35%.  Balance Sheet 20112010 Assets:  Cash$10,000$6,000 Accounts Receivable (net) 6,0001,500 Inventory 8,00010,000 Long-lived assets12,00011,000 Less: Accumulated depreciation (4,000) ‾(2,000) ‾ Total assets $32,000‾$26,500‾ Liabilities and Stockholders’ Equity: Accounts payable $5,000$6,000 Deferred revenues 1,0002,000 Long-term note payable 10,00010,000 Less: Discount on note payable(800) (1,000) Common stock 12,0006,000 Retained earnings4,800‾$3,500‾Total liabilities and stockholders’ equity $32,000‾$26,500‾ Income Statement For the year ended December 31, 2011  Revenues$42,000 Cost of goods sold (24,000)  Depreciation expense(2,000)  Interest expense (3,000)  Bad debt expense(2,000)  Other expense (including income taxes)  (9,000) ‾ Net income $2,000‾\begin{array}{llcc}\text { Balance Sheet }&2011&2010 \\ \text { Assets: } &\\ \text { Cash} &\$10,000&\$6,000\\ \text { Accounts Receivable (net) } &6,000&1,500\\ \text { Inventory } &8,000&10,000\\ \text { Long-lived assets} &12,000&11,000\\ \text { Less: Accumulated depreciation } &\underline{(4,000) }&\underline{(2,000) } \\ \text { Total assets } &\underline{\$32,000}&\underline{\$26,500}\\\\ \text { Liabilities and Stockholders' Equity: } &\\ \text {Accounts payable } &\$5,000&\$6,000\\ \text { Deferred revenues } &1,000&2,000\\ \text { Long-term note payable } &10,000&10,000\\ \text { Less: Discount on note payable} & (800) &(1,000) \\ \text {Common stock } &12,000&6,000\\ \text { Retained earnings} &\underline{4,800}&\underline{\$3,500}\\ \text {Total liabilities and stockholders' equity } &\underline{\$32,000}&\underline{\$26,500}\\\\ \text { Income Statement} &\\ \text { For the year ended December 31, 2011 } &\\ \text { Revenues} &&\$42,000\\ \text { Cost of goods sold } &&(24,000) \\ \text { Depreciation expense} &&(2,000) \\ \text { Interest expense } &&(3,000) \\ \text { Bad debt expense} &&(2,000) \\ \text { Other expense (including income taxes) }& &\underline{(9,000) }\\ \text { Net income } &&\underline{\$2,000}\\\end{array} - Refer to the information for Orca Industries. Orca's inventory turnover is


A) 2.67
B) 3.0
C) 2.4
D) 1.0

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Orca Industries Below are the two most recent balance sheets and most recent income statement for Orca Industries. The company has an effective tax rate of 35%.  Balance Sheet 20112010 Assets:  Cash$10,000$6,000 Accounts Receivable (net) 6,0001,500 Inventory 8,00010,000 Long-lived assets12,00011,000 Less: Accumulated depreciation (4,000) ‾(2,000) ‾ Total assets $32,000‾$26,500‾ Liabilities and Stockholders’ Equity: Accounts payable $5,000$6,000 Deferred revenues 1,0002,000 Long-term note payable 10,00010,000 Less: Discount on note payable(800) (1,000) Common stock 12,0006,000 Retained earnings4,800‾$3,500‾Total liabilities and stockholders’ equity $32,000‾$26,500‾ Income Statement For the year ended December 31, 2011  Revenues$42,000 Cost of goods sold (24,000)  Depreciation expense(2,000)  Interest expense (3,000)  Bad debt expense(2,000)  Other expense (including income taxes)  (9,000) ‾ Net income $2,000‾\begin{array}{llcc}\text { Balance Sheet }&2011&2010 \\ \text { Assets: } &\\ \text { Cash} &\$10,000&\$6,000\\ \text { Accounts Receivable (net) } &6,000&1,500\\ \text { Inventory } &8,000&10,000\\ \text { Long-lived assets} &12,000&11,000\\ \text { Less: Accumulated depreciation } &\underline{(4,000) }&\underline{(2,000) } \\ \text { Total assets } &\underline{\$32,000}&\underline{\$26,500}\\\\ \text { Liabilities and Stockholders' Equity: } &\\ \text {Accounts payable } &\$5,000&\$6,000\\ \text { Deferred revenues } &1,000&2,000\\ \text { Long-term note payable } &10,000&10,000\\ \text { Less: Discount on note payable} & (800) &(1,000) \\ \text {Common stock } &12,000&6,000\\ \text { Retained earnings} &\underline{4,800}&\underline{\$3,500}\\ \text {Total liabilities and stockholders' equity } &\underline{\$32,000}&\underline{\$26,500}\\\\ \text { Income Statement} &\\ \text { For the year ended December 31, 2011 } &\\ \text { Revenues} &&\$42,000\\ \text { Cost of goods sold } &&(24,000) \\ \text { Depreciation expense} &&(2,000) \\ \text { Interest expense } &&(3,000) \\ \text { Bad debt expense} &&(2,000) \\ \text { Other expense (including income taxes) }& &\underline{(9,000) }\\ \text { Net income } &&\underline{\$2,000}\\\end{array} - Refer to the information for Orca Industries. Orca's asset turnover is


A) 1.31
B) 1
C) 1.58
D) 1.44

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Firms with simple capital structures can have which of the following?


A) outstanding convertible bonds.
B) stock options issued
C) stock warrants issued
D) declared preferred stock dividends

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Time-series analysis helps answer all of the following questions except:


A) Is the firm becoming more or less profitable over time?
B) Is the firm becoming more or less risky?
C) How is management of the firm responding to external economic forces?
D) What is the amount of assets or capital required to generate a particular level of earnings?

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Net Devices Inc. The following balance sheets and income statements are for Net Devices Inc., a manufacturer of small electronic devices, including calculators, personal digital assistants and mp3 players. For purposes of these questions assume that the company has an effective tax rate of 35%. Net Devices Inc. The following balance sheets and income statements are for Net Devices Inc., a manufacturer of small electronic devices, including calculators, personal digital assistants and mp3 players. For purposes of these questions assume that the company has an effective tax rate of 35%. \text { INCOME STATEMENTS ( } \$ \text { in thousands) } \begin{array}{c} \begin{array}{lll} \text { Fiscal year end}\\ \text { Net sales}\\ \text { Cost of Goods Sold}\\ \text { Gross profit}\\ \\ \text { Selling, general \& admin. Exp.}\\ \text { Income before deprec. \& amort.}\\ \\ \text { Depreciation \& amortization}\\ \text { Interest expense}\\ \\ \text { Income before tax}\\ \text { Provision for income taxes}\\ \text { Minority interest}\\ \\ \text { Net income}\\ \\ \text { Outstanding shares (in thousands) }\\ \text { Preferred Dividends (in thousands) } \end{array} \begin{array}{l} 2011 \\ \$ 11,455,500 \\ \underline{(8.026 .450) }\\ {3,429,050} \\ \\ \underline{(1.836 .400) }\\ {1,592,650} \\ \\ (785,250) \\ \underline{(46.195) } \\ \\ 761,205 \\ (157,725) \\ \underline{\quad\quad-}\\ \\ \underline{\$603.480} \\ \\ 308,515 \\ \$ 85000 \\ \end{array} \begin{array}{l} 2010 \\ \$ 11,082,100 \\ \underline{(7.940 .065) }\\ {3,142,035} \\ \\ \underline{(1,789,200) }\\ {1,352,835} \\ \\ (757,250) \\ \underline{(43,340) }\\ \\ 552,245 \\ (112,290) \\ \underline{\quad\quad-}\\ \\ \underline{ \$ 439.955} \\ \\ 303,095 \\ \$ 85,000 \end{array} \end{array} - Refer to the information for Net Devices Inc. What is the rate of return on assets for Net Devices for 2011? A) 11.64% B) 14.50% C) 12.60% D) 13.88%  INCOME STATEMENTS ( $ in thousands)  \text { INCOME STATEMENTS ( } \$ \text { in thousands) }  Fiscal year end Net sales Cost of Goods Sold Gross profit Selling, general & admin. Exp. Income before deprec. & amort. Depreciation & amortization Interest expense Income before tax Provision for income taxes Minority interest Net income Outstanding shares (in thousands)  Preferred Dividends (in thousands) 2011$11,455,500(8.026.450) ‾3,429,050(1.836.400) ‾1,592,650(785,250) (46.195) ‾761,205(157,725) −‾$603.480‾308,515$850002010$11,082,100(7.940.065) ‾3,142,035(1,789,200) ‾1,352,835(757,250) (43,340) ‾552,245(112,290) −‾$439.955‾303,095$85,000\begin{array}{c}\begin{array}{lll} \text { Fiscal year end}\\ \text { Net sales}\\ \text { Cost of Goods Sold}\\ \text { Gross profit}\\\\ \text { Selling, general \& admin. Exp.}\\ \text { Income before deprec. \& amort.}\\\\ \text { Depreciation \& amortization}\\ \text { Interest expense}\\\\ \text { Income before tax}\\ \text { Provision for income taxes}\\ \text { Minority interest}\\\\ \text { Net income}\\\\ \text { Outstanding shares (in thousands) }\\ \text { Preferred Dividends (in thousands) }\end{array}\begin{array}{l}2011 \\\$ 11,455,500 \\\underline{(8.026 .450) }\\{3,429,050} \\\\\underline{(1.836 .400) }\\{1,592,650} \\\\(785,250) \\\underline{(46.195) } \\\\761,205 \\(157,725) \\\underline{\quad\quad-}\\\\\underline{\$603.480} \\\\308,515 \\\$ 85000 \\ \end{array}\begin{array}{l}2010 \\\$ 11,082,100 \\\underline{(7.940 .065) }\\{3,142,035} \\\\\underline{(1,789,200) }\\{1,352,835} \\\\(757,250) \\\underline{(43,340) }\\\\552,245 \\(112,290) \\\underline{\quad\quad-}\\\\\underline{ \$ 439.955} \\\\ 303,095 \\\$ 85,000 \end{array}\end{array} - Refer to the information for Net Devices Inc. What is the rate of return on assets for Net Devices for 2011?


A) 11.64%
B) 14.50%
C) 12.60%
D) 13.88%

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Sustainable earnings represent


A) the level of earnings expected to persist in the future.
B) the level of earnings and the growth in the levels of earnings expected to persist in the future.
C) the growth rate of future earnings.
D) retained earnings.

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Critics of EPS as a measure of profitability point out that it does not consider:


A) simple capital structures.
B) the amount of assets or capital required to generate a particular level of earnings.
C) the deduction of preferred stock dividends from net income.
D) Adjustments for dilutive securities and the adjustment to weighted average number of shares outstanding for complex capital structures.

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Which of the following might an analyst not want to eliminate from past earnings when using past earnings to forecast future earnings?


A) nonrecurring gains from the sale of assets.
B) unusual asset impairment charges.
C) nonrecurring restructuring charges.
D) revenue from the sale of inventory.

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Which of the following scenarios is consistent with a increasing cost of goods sold to sales percentage and increasing inventory turnover


A) Firm raises prices to increase its gross margin but inventory sells more slowly.
B) Weak economic conditions lead to reduced demand for a firm's products, necessitating price reductions to move goods.
C) Strong economic conditions lead to increased demand for a firm's products, allowing price increases.
D) Firm shifts its product mix toward lower margin, faster moving products.

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The ability of a firm to manage the level of investment in assets for a particular level of sales is measured by the ______________________________.

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Raleigh Manufacturing reported net income (amounts in millions) of $1,166 on sales of $5,520 during Year 4. Interest expense totaled $75. The income tax rate was 30 percent. Average total assets were $7,135, and average common shareholders' equity was $3,405. The firm did not have preferred stock outstanding or minority interest in its equity. REQUIRED: a. Compute the rate of ROA. Disaggregate ROA into profit margin for ROA and assets turnover components. b. Compute the rate of ROCE. Disaggregate ROCE into profit margin for ROCE, assets turnover, and capital structure leverage ratio components. c. Calculate the amount of net income to common shareholders derived from the excess return on creditors' capital and the amount from the return on common shareholders' capital.

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a. Rate of Return on Assets: [$1,166 + (...

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Below is financial information for two sporting goods retailers. Extreme Sports Company operates a retail business and franchising business. At the end 2011, Extreme Sports had 263 Company-owned and 120 franchise-operated retail stores. Extreme's stores are located in suburban, strip mall and regional mall locations, the company operates in 32 states. All Sports Corporation sells sporting goods and related products at over 2,500 Company-operated retail stores. Selected Data for All Sports and Extreme Sports (amounts in millions) SalesCost of Goods SoldInterest ExpenseNet IncomeAverage A ccounts ReceivableAverage InventoryAverage Fixed AssetsAverage Total AssetsAverage T ax Rate All Sports $5,3203,8971382121149981,1632,47240% Extreine Sport$1,34488743331828613066240%\begin{array}{c}\begin{array}{lll}\\\text {Sales}\\\text {Cost of Goods Sold}\\\text {Interest Expense}\\\text {Net Income}\\\text {Average A ccounts Receivable}\\\text {Average Inventory}\\\text {Average Fixed Assets}\\\text {Average Total Assets}\\\text {Average T ax Rate}\end{array}\begin{array}{l}\text { All Sports }\\\$ 5,320 \\3,897 \\138 \\212 \\114 \\998 \\1,163 \\2,472 \\40 \%\end{array}\begin{array}{l}\text { Extreine Sport}\\ \$ 1,344 \\887\\43\\33\\18\\286\\130\\662\\40 \% \end{array}\end{array} Calculate the following ratios for All Sports and Extreme Sports: a. Return on assets b. Profit margin for ROA c. Assets turnover d. Accounts receivable turnover e. Inventory turnover f. Fixed asset turnover

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Which of the following is the primary objective in most financial statement analysis?


A) to value a firm's equity securities.
B) to look for unrecorded liabilities.
C) to establish a firm's strategy within the industry.
D) to define markets for the firm.

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