The R. M. Smithers Corporation earned an operating profit margin of 10.41 percent based on sales of$ 9.8 million
and total assets of $ 5.5million last year.
a.What wasSmithers’ total asset turnoverratio?
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b.During the comingyear, thecompany’s president has set a goal of attaining a total asset turnover of 3.. How much must firm salesincrease, other things being thesame, for the goal to beachieved?(State your answer in both dollars and the corresponding percent increase insales.)
c.What was Smithers’ operating return on assets lastyear? Assuming thefirm’s operating profit margin remains thesame, what will the operating return on assets be next year if the total asset turnover goal is achieved?