Styles, Inc., a clothing manufacturer, reported the information given below over a three year period.
|
2005 |
2004 |
2003 |
|
|
Sales |
$9,000 |
$6,000 |
$3,000 |
|
Net income |
1,683 |
852 |
288 |
|
Total assets |
20,036 |
10,650 |
3,692 |
|
Inventory |
1,500 |
960 |
500 |
|
Cost of goods sold |
5,500 |
3,500 |
1,800 |
|
Fixed assets |
4,000 |
2,500 |
1,500 |
(a) Compute the firm’s profit margin, asset turnover, day’s sales in inventory, fixed asset turnover, and return on assets for each year shown. (b) Discuss the company’s operating strategy over this time period.