hancial Statement Analysis 65. The following information pertains to Auburn Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit. 931 Cash and short-term investments Accounts receivable (net) Assets Inventory Property, plant and equipment Total Assets S 40,000 30,000 25,000 280,000 $375,000 Current liabilities Liabilities and Stockholders Equity Long-term liabilities Stockholders' equity-common Total Liabilities and stockholders' equity 60,000 95,000 220,000 $375,000 Sales Cost of goods sold Gross margin Operating expenses Net income Income Statement $ 90.000 45,000 45,000 10,000 $ 35,000 Number of shares of common stock Market price of common stock Dividends per share Cash provided by operations 6,000 20 1.00 $ 40,000 What is the rate earned on stockholders' equity? Round answer to a single decimal point. a. 9.3% 15.9% b. 24.0% C. LO: 17-03 OBJ: d. 40.9% DIF: KEY: Bloom's: Knowledge Moderate PTS: 1 ANS: B NAT: BUSPROG: Analytic

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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hancial Statement Analysis
65.
The following information pertains to Auburn Company. Assume that all balance sheet amounts
represent both average and ending balance figures. Assume that all sales were on credit.
931
Cash and short-term investments
Accounts receivable (net)
Assets
Inventory
Property, plant and equipment
Total Assets
S 40,000
30,000
25,000
280,000
$375,000
Current liabilities
Liabilities and Stockholders Equity
Long-term liabilities
Stockholders' equity-common
Total Liabilities and stockholders' equity
60,000
95,000
220,000
$375,000
Sales
Cost of goods sold
Gross margin
Operating expenses
Net income
Income Statement
$ 90.000
45,000
45,000
10,000
$ 35,000
Number of shares of common stock
Market price of common stock
Dividends per share
Cash provided by operations
6,000
20
1.00
$ 40,000
What is the rate earned on stockholders' equity? Round answer to a single decimal point.
a. 9.3%
15.9%
b.
24.0%
C.
LO: 17-03
OBJ:
d. 40.9%
DIF:
KEY: Bloom's: Knowledge
Moderate
PTS: 1
ANS: B
NAT: BUSPROG: Analytic
Transcribed Image Text:hancial Statement Analysis 65. The following information pertains to Auburn Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit. 931 Cash and short-term investments Accounts receivable (net) Assets Inventory Property, plant and equipment Total Assets S 40,000 30,000 25,000 280,000 $375,000 Current liabilities Liabilities and Stockholders Equity Long-term liabilities Stockholders' equity-common Total Liabilities and stockholders' equity 60,000 95,000 220,000 $375,000 Sales Cost of goods sold Gross margin Operating expenses Net income Income Statement $ 90.000 45,000 45,000 10,000 $ 35,000 Number of shares of common stock Market price of common stock Dividends per share Cash provided by operations 6,000 20 1.00 $ 40,000 What is the rate earned on stockholders' equity? Round answer to a single decimal point. a. 9.3% 15.9% b. 24.0% C. LO: 17-03 OBJ: d. 40.9% DIF: KEY: Bloom's: Knowledge Moderate PTS: 1 ANS: B NAT: BUSPROG: Analytic
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