Problem 3 (Profitability Ratios) The following data are from the financial statements of Parada, Inc.: December 31, 2019 Total Assets = 180,000 TotalEquity = 144,000 Total Preference Equity = 30,000 Preference Dividends Declares = 2,400 Profit = 20,000 Interest Expense = 5,750 January 1, 2019 Total Assets = 140,000 Total Equity = 112,000 Total Preference Equity = 30,000 Calculate the following ratios: 1. Return on total assets 2. Return on ordinary equity Please provide a solution
Problem 3 (Profitability Ratios) The following data are from the financial statements of Parada, Inc.: December 31, 2019 Total Assets = 180,000 TotalEquity = 144,000 Total Preference Equity = 30,000 Preference Dividends Declares = 2,400 Profit = 20,000 Interest Expense = 5,750 January 1, 2019 Total Assets = 140,000 Total Equity = 112,000 Total Preference Equity = 30,000 Calculate the following ratios: 1. Return on total assets 2. Return on ordinary equity Please provide a solution
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Problem 3 (Profitability Ratios)
The following data are from the financial statements of Parada, Inc.:
December 31, 2019
Total Assets = 180,000
TotalEquity = 144,000
Total Preference Equity = 30,000
Preference Dividends Declares = 2,400
Profit = 20,000
Interest Expense = 5,750
January 1, 2019
Total Assets = 140,000
Total Equity = 112,000
Total Preference Equity = 30,000
Calculate the following ratios:
1. Return on total assets
2. Return on ordinary equity
Please provide a solution.
Please provide a solution.
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