Discussion - A retailer has net sales of $500,000, total assets

Discussion

1)  A retailer has net sales of $500,000, total assets of $1,000,000, and a net profit of $60,000. What is its asset turnover? Describe what asset turnover means using your answer as an example. 

2) A retailer has these financial results: current assets, $500,000; fixed assets, $1,000,000; current liabilities, $520,000; fixed liabilities, $920,000; net sales, $8,000,000; and net profit, $120,000.

• Calculate the following:
  • net profit margin
  • return on assets
  • financial leverage
  • return on net worth

3) Comment on the financial health of this retailer.