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Database Systems is considering expansion into a new product line. Assets to support expansion will cost $320,000. It is estimated that Database can generate $1,430,000 in annual sales, with an 6 percent profit margin.

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Net income for the year would be $85,800 and the return on assets (investment) is 26.81%.

Net income represents the total profit a company earns after deducting all expenses and taxes.

Net Income = Annual Sales * Profit Margin

Net Income = $1,430,000 * 0.06

Net Income = $85,800

Return on assets (ROA) measures a company's efficiency in generating profit relative to its total assets which indicates its ability to use assets effectively for profitability.

Return on Assets (ROA) = Net Income / Total Assets

ROA = $85,800 / $320,000

ROA = 0.268125

ROA = 26.81%.

Full question:

Database Systems is considering expansion into a new product line. Assets to support expansion will cost $320,000. It is estimated that Database Systems can generate $1,430,000 in annual sales, with an 6 percent profit margin. What would net income and return on assets (investment) be for the year?

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