Question

Suppose during 2017 that Federal Express reported the following information (in millions): net sales of $34,450 and net income of $89. Its balance sheet also showed total assets at the beginning of the year of $24,590 and total assets at the end of the year of $23,300. Calculate the asset turnover and return on assets.

Answer 1

The asset turnover is 1.44 and return on assets is 0.37%

Step-by-step explanation:

Average Total assets

Assets in the beginning $24,590

Assets at the end $23,300

Average assets $23945

Sales $34,450

Divide: Average assets $23945

Assets turnover ratio 1.44

Net Income $89

Divide: Average assets $23945

Return on assets 0.37%

Therefore, The asset turnover is 1.44 and return on assets is 0.37%