Consider the following condensed financial statements of Freedom, Inc. The company’s target rate

Consider the following condensed financial statements of Freedom, Inc. The company's target rate of return is 10%: (Click the icon to view the comparative balance sheet.) Click the icon to view the income statement.) Read the requirements. Requirement 1. Calculate the company's ROI. Round all of your answers to four decimal places. Begin by selecting the formula to calculate return on investment (ROI), and then enter the amounts to calculate the company's ROI. (Round your calculations to four decimal places and enter your final to the nearest hundredth of a percent, X.XX%) Operating income i Average total assets ROL $ 100,000 1 5 84000 = 0.1712 % 1. Calculate the company's ROI. Round all of your answers to four decimal places. 2. Calculate the company's profit margin ratio. Interpret your results 3. Calculate the company's asset turnover ratio. Interpret your results 4. Use the expanded ROI formula to confirm your results from Requirement 1. Interpret your results. 5. Calculate the company's RI. Interpret your results. Freedom, Inc. Income Statement For the Year Ended December 31, 2018 Net Sales Revenue $ 1,000,000 Cost of Goods Sold 600,000 Gross Profit 400,000 300,000 Operating Expenses Operating Income 100,000 Other Income and (Expenses): Interest Expense (1,500) Income Before Income Tax Expense 98,500 34,475 Income Tax Expense 64,025 Net Income Freedom, Inc. Comparative Balance Sheet As of December 31, 2018 and 2017 2018 2017 Assets Cash $ 67,000 $ 55,000 Accounts Receivable 52,200 20,800 Supplies 4,000 3,400 Property, Plant, and Equipment, net 319,800 220.800 Patents, net 141,000 116,000 Total Assets $ 584,000 $ 416,000 Liabilities and Stockholders' Equity Accounts Payable $ 20,000 $ 22,000 Short-term Notes Payable 139,000 Long-term Notes Payable 187,000 117,500 Common Stock, no Par 223,000 227,000 Retained Earnings 15,000 4,500 Total Liabilities and Stockholders' Equity $ 584,000 $ 416,000

 

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