Torrid Romance Publishers has total receivables of $3,100, which represents 20 days’ sales. Total assets are

Torrid Romance Publishers has total receivables of $3,100, which represents 20 days’ sales. Total assets are $113,150. The firm’s operating profit margin is 5.4%. Find the firm’s asset turnover ratio and ROA. (Use 365 days in a year. Do not round intermediate calculations. Round your answers to 2 decimal places.)

Asset turnover ratio
ROA	%

Explanation:

Total sales = $3,100 × 365/20 = $56,575

Asset turnover ratio = $56,575/$113,150 = 0.50

ROA = asset turnover × operating profit margin = 0.50 × 0.054 = 0.0270 = 2.70%