Question

University Hero is considering expanding operations beyond its healthy sandwiches. Jim Axelrod, vice president of marketing, would like to add a line of smoothies with a similar health emphasis. Each smoothie would include two free health supplements such as vitamins, antioxidants, and protein. Jim believes smoothie sales should help fill the slow mid-afternoon period. Adding the line of smoothies would require purchasing additional freezer space, machinery, and equipment. Jim provides the following projections of net sales, net income, and average total assets in support of his proposal.

Sandwiches
Only

Sandwiches and Smoothies

  Net sales

$ 750,000     

$ 1,350,000   

  Net income

120,000     

210,000   

  Average total assets

350,000     

750,000   

Return on Assets
Choose Numerator	÷	Choose Denominator	=	Return on Assets
	÷		=	Return on assets
	÷		=
Profit Margin
	÷		=	Profit Margin
	÷		=
Asset Turnover
	÷		=	Asset Turnover
	÷		=		times

Answer 1