Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Assets Cash Accounts receivable Inventory Plant and equipment, net Investment in Buisson, S.A. Land (undeveloped) Total assets Joel de Paris, Inc. Income Statement Sales Liabilities and Stockholders' Equity Accounts payable Long-term debt Stockholders' equity Total liabilities and stockholders' equity $ Operating expenses Net operating income Interest and taxes: Interest expense Tax expense Net income $ 129,000 Beginning Balance 208,000 $ $ $ 140,000 334,000 562,000 804,000 402,000 248,000 2,490,000 378,000 950,000 1,162,000 2,490,000 $ 5,022,000 4,268,700 753,300 337,000 $ 416,300 Ending Balance $ 132,000 483,000 473,000 792,000 429,000 247,000 $ 2,556,000 $ 335,000 950,000 1,271,000 $ 2,556,000 The company paid dividends of $307,300 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%. 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?
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Assets Cash Accounts receivable Inventory Plant and equipment, net Investment in Buisson, S.A. Land (undeveloped) Total assets Joel de Paris, Inc. Income Statement Sales Liabilities and Stockholders' Equity Accounts payable Long-term debt Stockholders' equity Total liabilities and stockholders' equity $ Operating expenses Net operating income Interest and taxes: Interest expense Tax expense Net income $ 129,000 Beginning Balance 208,000 $ $ $ 140,000 334,000 562,000 804,000 402,000 248,000 2,490,000 378,000 950,000 1,162,000 2,490,000 $ 5,022,000 4,268,700 753,300 337,000 $ 416,300 Ending Balance $ 132,000 483,000 473,000 792,000 429,000 247,000 $ 2,556,000 $ 335,000 950,000 1,271,000 $ 2,556,000 The company paid dividends of $307,300 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%. 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?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Financial data for Joel de Paris, Inc., for last year follow:
Joel de Paris, Inc.
Balance Sheet
Assets
Cash
Accounts receivable
Inventory
Plant and equipment, net
Investment in Buisson, S.A.
Land (undeveloped)
Total assets
Joel de Paris, Inc.
Income Statement
Sales
Liabilities and Stockholders' Equity
Accounts payable
Long-term debt
Stockholders' equity
Total liabilities and stockholders' equity $
Operating expenses
Net operating income
Interest and taxes:
Interest expense
Tax expense
Net income
$ 129,000
Beginning
Balance
208,000
$
$
$
140,000
334,000
562,000
804,000
402,000
248,000
2,490,000
378,000
950,000
1,162,000
2,490,000
$ 5,022,000
4,268,700
753,300
337,000
$ 416,300
Ending
Balance
$ 132,000
483,000
473,000
792,000
429,000
247,000
$ 2,556,000
$ 335,000
950,000
1,271,000
$ 2,556,000
The company paid dividends of $307,300 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%.
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?
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