An Appliance Store Has Total Assets of $2,800,000, Accounts Receivable

question 61

Multiple Choice

An appliance store has total assets of $2,800,000, accounts receivable of $900,000, accounts payable of $700,000, inventory valued at $1,500,000, and total liabilities of $2,500,000. In 2016, its net sales were $2,100,000, and its operating profit margin equaled $42,000. Calculate the store's return on assets.

• A) 71.4 percent
• B) 2.8 percent
• C) 7.5 percent
• D) 1.5 percent
• E) 75 percent

Comprehend the consolidation process including the preparation of consolidation worksheets and the importance of uniform accounting policies.

Identify and calculate goodwill or gain on bargain purchases in business combinations.

Recognize and adjust for differences in reporting dates and financial periods between parent and subsidiary entities.

Determine the impacts of business combination on tax liabilities and assets.