Question

# Brief Exercise 11-10 In its 2017 annual report, Campbell Soup Company reports beginning-of-the-year total assets of...

Brief Exercise 11-10

In its 2017 annual report, Campbell Soup Company reports beginning-of-the-year total assets of \$7,837 million, end-of-the-year total assets of \$7,726 million, total sales of \$7,890 million, and net income of \$887 million.

Compute Campbell’s asset turnover. (Round answer to 4 decimal places, e.g. 4.8726.)
 Asset turnover enter asset turnover in times rounded to 4 decimal places times
Compute Campbell’s profit margin on sales. (Round answer to 2 decimal places, e.g. 4.87%.)
 Profit margin on sales enter profit margin on sales in percentages rounded to 4 decimal places %
Compute Campbell’s return on assets using (1) asset turnover and profit margin and (2) net income. (Round answers to 2 decimal places, e.g. 4.87%.)
Return on assets (1) enter percentages rounded to 2 decimal places % enter percentages rounded to 2 decimal places %

 Ans. 1 Assets turnover = Sales / Average assets \$7,890 / \$7,781.50 1.0139 times *Average assets = (Beginning assets + Ending assets) / 2 (\$7,837 + \$7,726) / 2 \$7,781.50 million Ans. 2 Profit margin = Net income / Net sales * 100 \$887 / \$7,890 * 100 11.24% (or 0.1124) Ans. 3 - (1) Return on assets = Asset turnover * Profit margin 1.0139 * 11.24% 11.40% Ans. 3 - (2) Return on assets = Net income / Average assets * 100 \$887 / \$7,781.50 * 100 11.40%

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