Nucor Corporation produces steel and steel products at its eight mills and is a major recycler...

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Nucor Corporation produces steel and steel products at its eight mills and is a major recycler of scrap metal. The following

Required 1 Required 2 Required 3 Has Nucors profitability changed over the three years? Has Nucors profitability changed ov

Required 1 Required 2 Required 3 Calculate the rate of return on common stockholders equity for 2012, 2013, and 2014. (Round

business accounting

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Answer 1

Answer #1

1). Return on Assets = Net Income / Average Total Assets

2012 = $593.1 / [($14,152.1 + $14,570.4) /2] = 0.04130 or 4.13%
2013 = $585.5 / [($15,203.3 + $14,152.1) /2] = 0.03989 or 3.989%
2014 = $815.8 / [($15,615.9 + $15,203.3) /2] = 0.05294 or 5.294%

Operating profit margin = Net Income / Sales
2012 = $593.1 / $19,429.3 = 0.03053 or 3.053%
2013 = $585.5 / $19,052.0 = 0.03073 or 3.073%
2014 = $815.8 / $21,105.1 = 0.03865 or 3.865%

Assets Turnover = Sales / Average Total Assets
2012 = $19,429.3 / [($14,152.1 + $14,570.4) /2] = 1.35
2013 = $19,052.0 / [($15,203.3 + $14,152.1) /2] = 1.30
2014 = $21,105.1 / [($15,615.9 + $15,203.3) /2] = 1.37

2). Yes, Nucor's profitability is changed over the three years.

3). Rate of return on equity = Net Income / Average common stockholder's equity
2012 = $593.1 / [($7,706.6 + $7,885.4) /2] = 0.07608 or 7.608%
2013 = $585.5 / [($7,910.3 + $7,885.4) /2] = 0.07413 or 7.413%
2014 = $815.8 / [($8,075.1 + $7,910.3) /2] = 0.10207 or 10.207%

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