I uploaded pictures for problem 17-4B.I am trying to figure out the 12.Return on total assets **Measures of Liquidity, Solvency, and Profitability**The comparative financial statements for Stargel Inc. are detailed below. The market price of Stargel common stock was $119.70 on December 31, 20Y2.**Stargel Inc.****Comparative Retained Earnings Statement***For the Years Ended December 31, 20Y2 and 20Y1*| **Description** | **20Y2** | **20Y1** ||------------------------------------------------------|--------------|--------------|| Retained earnings, January 1 | $4,945,000 | $4,945,000 || Net Income | $925,000 | $900,000 || **Total** | $5,470,000 | $5,375,000 || **Dividends:** | | || Preferred stock dividends | $45,000 | $45,000 || Common stock dividends | $50,000 | $50,000 || **Total dividends** | $95,000 | $95,000 || Retained earnings, December 31 | $5,375,000 | $5,280,000 |This statement displays the changes in retained earnings for Stargel Inc. over two fiscal years, showcasing the net income and dividends to calculate the final retained earnings for each year. # Stargel Inc. Financial Overview## Comparative Income Statement *For the Years Ended December 31, 20Y2 and 20Y1*### 20Y2 vs. 20Y1- **Sales**: - 20Y2: $10,000,000 - 20Y1: $9,400,000- **Cost of Goods Sold**: - 20Y2: $5,350,000 - 20Y1: $4,950,000- **Gross Profit**: - 20Y2: $4,650,000 - 20Y1: $4,450,000- **Selling Expenses**: - 20Y2: $2,000,000 - 20Y1: $1,880,000- **Administrative Expenses**: - 20Y2: $1,500,000 - 20Y1: $1,410,000- **Total Operating Expenses**: - 20Y2: $3,500,000 - 20Y1: $3,290,000- **Income from Operations**: - 20Y2: $1,150,000 - 20Y1: $1,160,000- **Other Revenue**: - 20Y2: $300,000 - 20Y1: $300,000- **Other Expense (Interest)**: - 20Y2: $320,000 - 20Y1: $310,000- **Income Before Income Tax**: - 20Y2: $1,130,000 - 20Y1: $1,150,000- **Income Tax Expense**: - 20Y2: $230,000 - 20Y1: $225,000- **Net Income**: - 20Y2: $900,000 - 20Y1: $925,000---## Comparative Balance Sheet *December 31, 20Y2 and 20Y1*### Assets- **Current Assets**: - Cash: - 20Y2: $500,000 - 20Y1:

Average total assets = (beginning total assets + ending total assets) / 2 = (9780000+8755000)/2 =…

percentages, except for per-share amounts: For the Years Ended December 31, 20Y2 and 20Y1 Stargel Inc. Comparative Income Statement 20Υ2 20Υ1 Sales $10,000,000 $9,400,000 Cost of goods sold.. Gross profit.. Selling expenses.... 5,350,000 4,950,000 $ 4,650,000 $4,450,000 $ 2,000,000 $1,880,000 Administrative expenses. 1,500,000 $ 3,500,000 $ 1,150,000 1,410,000 Total operating expenses Income from operations $3,290,000 $1,160,000 Other revenue..... 150,000 $ 1,300,000 140,000 $1,300,000 Other expense (interest) 170,000 150,000 Income before income tax $ 1,130,000 $1,150,000 Income tax expense 230,000 225,000 Net income ... $ 900,000 $ 925,000 Stargel Inc. Comparative Balance Sheet December 31, 20Y2 and 20Y1 20Y2 20Υ1 Assets Current assets: Cash $ 500,000 $ 400,000 Marketable securities. 1,010,000 1,000,000 Accounts receivable (net) 740,000 510,000 Inventories 1,190,000 950,000 Prepaid expenses 250,000 229,000 Total current assets. $3,690,000 $3,089,000 Long-term investments Property, plant, and equipment (net) 2,350,000 2,300,000 3,740,000 3,366,000 Total assets $9,780,000 $8,755,000 Liabilities Current liabilities.. $ 900,000 $ 880,000 Long-term liabilities: Mortgage note payable, 10%. Bonds payable, 10%. Total long-term liabilities Total liabilities $ 200,000 %24 1,500,000 1,500,000 $1,700,000 $1,500,000 $2,600,000 $2,380,000 Stockholders' Equity Preferred $0.90 stock, $10 par. Common stock, $5 par... $ 500,000 $ 500,000 500,000 500,000 Retained earnings. 6,180,000 5,375,000 Total stockholders' equity.. Total liabilities and stockholders' equity.. $7,180,000 $9,780,000 $6,375,000 $8,755,000 Instructions Determine the following measures for 20Y2, rounding to one decimal place including

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q