Markus Company’s common stock sold for $4.75 per share at the end of this year. The company paid a common stock dividend of $0.57 per share this year. It also provided the following data excerpts from this year’s financial statements: Ending Balance Beginning Balance Cash $ 44,000 $ 43,200 Accounts receivable $ 92,000 $ 66,200 Inventory $ 73,300 $ 92,000 Current assets $ 209,300 $ 201,400 Total assets $ 750,000 $ 809,000 Current liabilities $ 84,000 $ 87,000 Total liabilities $ 210,000 $ 189,000 Common stock, $1 par value $ 158,000 $ 158,000 Total stockholders’ equity $ 540,000 $ 620,000 Total liabilities and stockholders’ equity $ 750,000 $ 809,000 This Year Sales (all on account) $ 1,080,000 Cost of goods sold $ 626,400 Gross margin $ 453,600 Net operating income $ 276,500 Interest expense $ 14,000 Net income $ 183,750 Foundational 14-4 (Algo) 4. What is the return on total assets (assuming a 30% tax rate)?
Markus Company’s common stock sold for $4.75 per share at the end of this year. The company paid a common stock dividend of $0.57 per share this year. It also provided the following data excerpts from this year’s financial statements: Ending Balance Beginning Balance Cash $ 44,000 $ 43,200 Accounts receivable $ 92,000 $ 66,200 Inventory $ 73,300 $ 92,000 Current assets $ 209,300 $ 201,400 Total assets $ 750,000 $ 809,000 Current liabilities $ 84,000 $ 87,000 Total liabilities $ 210,000 $ 189,000 Common stock, $1 par value $ 158,000 $ 158,000 Total stockholders’ equity $ 540,000 $ 620,000 Total liabilities and stockholders’ equity $ 750,000 $ 809,000 This Year Sales (all on account) $ 1,080,000 Cost of goods sold $ 626,400 Gross margin $ 453,600 Net operating income $ 276,500 Interest expense $ 14,000 Net income $ 183,750 Foundational 14-4 (Algo) 4. What is the return on total assets (assuming a 30% tax rate)?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Markus Company’s common stock sold for $4.75 per share at the end of this year. The company paid a common stock dividend of $0.57 per share this year. It also provided the following data excerpts from this year’s financial statements:
| Ending Balance | Beginning Balance | |
|---|---|---|
| Cash | $ 44,000 | $ 43,200 |
| $ 92,000 | $ 66,200 | |
| Inventory | $ 73,300 | $ 92,000 |
| Current assets | $ 209,300 | $ 201,400 |
| Total assets | $ 750,000 | $ 809,000 |
| Current liabilities | $ 84,000 | $ 87,000 |
| Total liabilities | $ 210,000 | $ 189,000 |
| Common stock, $1 par value | $ 158,000 | $ 158,000 |
| Total |
$ 540,000 | $ 620,000 |
| Total liabilities and stockholders’ equity | $ 750,000 | $ 809,000 |
| This Year | |
|---|---|
| Sales (all on account) | $ 1,080,000 |
| Cost of goods sold | $ 626,400 |
| Gross margin | $ 453,600 |
| Net operating income | $ 276,500 |
| Interest expense | $ 14,000 |
| Net income | $ 183,750 |
Foundational 14-4 (Algo)
4. What is the return on total assets (assuming a 30% tax rate)?
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