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2008 2007
a. Net sales Rp1,498,000 Rp1,200,000
Total assets: Beginning of year
Rp1,053,000 Rp1,010,000 End of year
1,044,500 1,053,000
Total Rp2,097,500 Rp2,063,000
b. Average Total2 Rp1,048,750 Rp1,031,500
17-3
PT Latuconsina in ‘000 Rp
Excludes long-term investments
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2008 2007
a. Net sales Rp1,498,000 Rp1,200,000
Total assets: Beginning of year
Rp1,053,000 Rp1,010,000 End of year
1,044,500 1,053,000
Total Rp2,097,500 Rp2,063,000
b. Average Total2 Rp1,048,750 Rp1,031,500
17-3
PT Latuconsina in ‘000 Rp
Ratio of net sales to assets ab 1.4 1.2
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Example Exercise 17-8
17-3
A company reports the following: Net sales
Rp2,250,000,000 Average total sales
1,500,000,000 Determine the ratio of net sales to assets.
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Follow My Example 17-8
Ratio of Net Sales to Total Assets = Net SalesAverage Total Assets
Ratio of Net Sales to Total Assets = Rp2,250,000,000Rp1,500,000,000
Ratio of Net Sales to Total Assets = 1.5
For Practice: PE 17-8A, PE 17-8B
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17-3
Rate Earned on Total Assets
The rate earned on total
assets measures the
profitability of total assets, without considering how the
assets are financed.
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2008 2007
Rate earned on total assets ab 8.2 7.3
Net income Rp 91,000 Rp 76,500
Plus interest expense 6,000
12,000 a. Total
Rp 97,000 Rp 88,500 Total assets:
Beginning of year Rp1,230,500 Rp1,187,500
End of year 1,139,500
1,230,500 Total
Rp2,370,000 Rp2,418,000 b. Average Total2
Rp1,185,000 Rp1,209,000
17-3
PT Latuconsina in ‘000 Rp
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Example Exercise 17-9
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A company reports the following income statement and balance sheet information for the current year:
Net income Rp 125,000,000
Interest expense 25,000,000
Average total assets 2,000,000,000
Determine the rate earned on total assets.
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For Practice: PE 17-9A, PE 17-9B Follow My Example 17-9
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17-3
Rate Earned on Total Assets = Net Income + Interest ExpenseAverage Total
Assets
Rate Earned on Total Assets =
Rp125,000,000 +Rp25,000,000Rp2,000,000,000
Rate Earned on Total Assets = 7.5
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17-3
Rate Earned on Stockholders’ Equity
The rate earned on
stockholders’ equity
measure emphasizes the rate of income
earned on the amount invested by the stockholders.
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Rate earned on stockholders’ equity ab 11.3 10.0
a. Net income Rp 91,000 Rp 76,500
