Office Depot, Inc. is one of the largest suppliers of office products in the United States. Suppose it had net income of $738.7 million and sales of $50,000 million in 2020 Its total assets were $13,073.1 million at the beginning of the year and $13,717.3 million at the end of the year. What is Office Depot, Inc.’s (a) asset turnover and (b) profit margin? (Round to two decimals.) Provide a brief interpretation of your results.
Office Depot, Inc. is one of the largest suppliers of office products in the United States. Suppose it had net income of $738.7 million and sales of $50,000 million in 2020 Its total assets were $13,073.1 million at the beginning of the year and $13,717.3 million at the end of the year. What is Office Depot, Inc.’s (a) asset turnover and (b) profit margin? (Round to two decimals.) Provide a brief interpretation of your results.
Asset turnover ratio is the ratio of Net Sales divided by the amount of average assets invested. This ratio indicates that how efficiently business assets are being used to generate revenues.
Asset turnover ratio = Net Sales/ Average Total Assets
Profit margin is the ratio of net profit earned with respect to revenues.
Profit margin = Net Income/Sales
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