Assets Cash Accounts receivable. Inventory Plant and equipment, net Investment in Buisson, S.A. Land (undeveloped) Total assets Liabilities and Stockholders' Equity Accounts payable Long-term debt Stockholders' equity Total liabilities and stockholders' equity Joel de Paris, Incorporated Balance Sheet Joel de Paris, Incorporated Income Statement Sales Operating expenses Net operating income Interest and taxes: Interest expense Tax expense Net income $ 130,000 198,000 1. Average operating assets 2. Margin 2. Turnover 2. ROI 3. Residual income $ 4,632,000 3,890,880 741,120 328,000 $ 413,120 Beginning Balance % $ 131,000 330,000 578,000 871,000 % 394,000 250,000 $ 2,554,000 $ 374,000 1,029,000 1,151,000 $ 2,554,000 Ending Balance $ 126,000 488,000 470,000 866,000 The company paid dividends of $303,120 last year. The "Investment in Buisson, S.A.," on the balance sheet represents an investment in the stock of another company. The company's minimum required rate of return of 15%. 430,000 254,000 $ 2,634,000 Required: 1. Compute the company's average operating assets for last year. 2. Compute the company's margin, turnover, and return on investment (ROI) for last year. (Do not round intermediate calculations and round your final answers to 2 decimal places.) 3. What was the company's residual income last year? $ 344,000 1,029,000 1,261,000 $ 2,634,000
Assets Cash Accounts receivable. Inventory Plant and equipment, net Investment in Buisson, S.A. Land (undeveloped) Total assets Liabilities and Stockholders' Equity Accounts payable Long-term debt Stockholders' equity Total liabilities and stockholders' equity Joel de Paris, Incorporated Balance Sheet Joel de Paris, Incorporated Income Statement Sales Operating expenses Net operating income Interest and taxes: Interest expense Tax expense Net income $ 130,000 198,000 1. Average operating assets 2. Margin 2. Turnover 2. ROI 3. Residual income $ 4,632,000 3,890,880 741,120 328,000 $ 413,120 Beginning Balance % $ 131,000 330,000 578,000 871,000 % 394,000 250,000 $ 2,554,000 $ 374,000 1,029,000 1,151,000 $ 2,554,000 Ending Balance $ 126,000 488,000 470,000 866,000 The company paid dividends of $303,120 last year. The "Investment in Buisson, S.A.," on the balance sheet represents an investment in the stock of another company. The company's minimum required rate of return of 15%. 430,000 254,000 $ 2,634,000 Required: 1. Compute the company's average operating assets for last year. 2. Compute the company's margin, turnover, and return on investment (ROI) for last year. (Do not round intermediate calculations and round your final answers to 2 decimal places.) 3. What was the company's residual income last year? $ 344,000 1,029,000 1,261,000 $ 2,634,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Assets
Cash
Accounts receivable.
Inventory
Plant and equipment, net
Investment in Buisson, S.A.
Land (undeveloped)
Total assets
Liabilities and Stockholders' Equity
Accounts payable
Long-term debt
Stockholders' equity
Total liabilities and stockholders' equity
Joel de Paris, Incorporated
Balance Sheet
Joel de Paris, Incorporated
Income Statement
Sales
Operating expenses
Net operating income
Interest and taxes:
Interest expense
Tax expense
Net income
$ 130,000
198,000
1. Average operating assets
2. Margin
2. Turnover
2. ROI
3. Residual income
$ 4,632,000
3,890,880
741,120
328,000
$ 413,120
Beginning
Balance
%
$ 131,000
330,000
578,000
871,000
%
394,000
250,000
$ 2,554,000
$ 374,000
1,029,000
1,151,000
$ 2,554,000
Ending Balance
$ 126,000
488,000
470,000
866,000
The company paid dividends of $303,120 last year. The "Investment in Buisson, S.A.," on the balance sheet represents an investment
in the stock of another company. The company's minimum required rate of return of 15%.
430,000
254,000
$ 2,634,000
Required:
1. Compute the company's average operating assets for last year.
2. Compute the company's margin, turnover, and return on investment (ROI) for last year. (Do not round intermediate calculations and
round your final answers to 2 decimal places.)
3. What was the company's residual income last year?
$ 344,000
1,029,000
1,261,000
$ 2,634,000
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