A Company Had Net Income of $76,000 in Year 1

question 76

Essay

A company had net income of $76,000 in Year 1 and $88,000 in Year 2. Its net sales were $640,000 in Year 1 and $611,000 in Year 2. Its average total assets in Year 1 were $670,000 and $712,000 in Year 2. Calculate the profit margin, total asset turnover and return on total assets for both years. Comment on the results.

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Definitions:

Gap Junctions

Specialized intercellular connections that allow for the direct transfer of ions and molecules between neighboring cells, facilitating communication and coordination of activity.

Electrical Synapses

A type of synapse in which electrical currents flow directly from one cell to another via gap junctions, facilitating rapid communication.

Presynaptic Terminal

The end part of a nerve cell (neuron) that releases neurotransmitters to send a signal across the synapse to another neuron.

Acetylcholine

A neurotransmitter involved in many functions including muscle activation, heart rate, and the processing of memory and cognition.