Question: use the following balance sheet and income statement to calculate...
Question details
Use the following balance sheet and income statement to
calculate the firm's return on equity (net income / common
equity):
|
Balance Sheet |
Income Statement |
||
|
Assets: |
|||
|
Cash |
$3,000 |
Sales (all credit) |
$85,000 |
|
Accounts Receivable |
5,000 |
Cost of Goods Sold |
(51,000) |
|
Inventories |
6,500 |
||
|
Land |
20,000 |
Operating Expenses |
(15,000) |
|
Other Fixed Assets |
18,000 |
Depreciation |
(1,000) |
|
Liabilities & Owners' Equity |
Interest Expense |
(3,000) |
|
|
Accounts Payable |
4,000 |
||
|
Long Term Debt |
26,700 |
Taxes |
(5,100) |
|
Common Stock |
5,000 |
||
|
Paid in Capital |
12,000 |
||
|
Retained Earnings |
4,800 |
| 50.4% |
| 45.4% |
| 41.6% |
| 58.9% |
| 58.2% |
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