Calculate the sales-to-assets ratio


Problem: Could you help me calculate the sales-to-assets ratio, the profit margin, and the return on the two firms listed below;

Sales Profits Assets

Federal Stores       $100   $10    $50
General Stores         20     4       20

(Financial data is in the millions)

If these two companies were to merge and the federal stores continued to sale goods worth $100 million, could you show me how the three financial ratios would change?

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Finance Basics: Calculate the sales-to-assets ratio
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