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Use
the information provided to analyze the profitability of SDHS Co using the
following ratios: return on assets


Sales

$ 350,000

Gross profit

206,500

Net income

115,000

Interest expense

2,875

Average total assets

875,000

Average total shareholders' equity

500,000

Weighted-average common shares outstanding

25,000

The return on assets is

1 point

Answer :

Answer:

To calculate the return on assets (ROA) ratio, we can use the formula:

ROA = Net Income / Average Total Assets

Given the information provided:

Net Income = $115,000

Average Total Assets = $875,000

Let's calculate the ROA:

ROA = $115,000 / $875,000

ROA ≈ 0.1314 or 13.14%

Therefore, the return on assets (ROA) for SDHS Co is approximately 13.14%.

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