A Company Had Net Income of $450,000 in Year 1

question 22

Essay

A company had net income of $450,000 in Year 1 and $620,000 in Year 2. The company had average total assets of $2,500,000 in Year 1 and $3,000,000 in Year 2. Calculate the return on total assets for Year 1and Year 2. Comment on the results, did the company's performance improve?

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Definitions:

Corrective Action

Measures taken to rectify a problem, error, or deviation from standard procedures to ensure it does not recur.

Process Controls

Controls that attempt to specify the manner in which tasks are to be accomplished.

Desired Targets

Desired targets are specific goals or outcomes that an individual or organization aims to achieve through their efforts and actions.

Chain of Command

A system in an organization where authority and responsibility are structured in a hierarchy, establishing clear paths for decision-making and command.