Financial Analysis

PROBLEM 8-1 Net Profit Margin | = | Net Income Before Minority Share of Earnings and Nonrecurring Items | | | Net Sales | 2011 | | 2010 | $52,500 | | $40,000 | $1,050,000 | | $1,000,000 | | | | = 5.00% | | = 4.00% | Return on Assets | = | Net Income Before Minority Share of Earnings and Nonrecurring Items | | | Average Total Assets |

2011 | | 2010 | $52,500 | | $40,000 | $230,000 | | $200,000 | | | | = 22.83% | | = 20.00% | Total Asset Turnover | = | Net Sales | | | Average Total Assets | 2011 | | 2010 | $1,050,000 | | $1,000,000 | $230,000 | | $200,000 | | | | =4.57 times