Information is presented below for two appliance companies.
|
(In thousands) |
Ardmore |
Bellwood |
|
Sales revenues |
$800 |
$800 |
|
Net income |
100 |
80 |
|
Total assets |
1,000 |
800 |
Required
A. Compute profit margin, asset turnover, and return on assets for each company.
B. Compare the operating strategies of the two companies and explain which company is doing the better job with its strategy.
C. Using the information presented, discuss how each company could improve its profits and return on assets.