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Profitability Ratios The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 2017, 2016, and 2015: December 31 2016 $221,000 80,000 32,000 16,000 Notes payable (0% interest) Common stock Preferred 4 stock, $100 par the change during year) 2017 $245,000 80,000 32,000 16,000 Retained earnings 101,650 70,710 40,000 The 2017 net income was $31,610, and the 2016 net income was $23,350. No dividends on common stock were declared between 2015 and 2017. Preferred dividen were declared and paid in full in 2016 and 2017. Determine the return on total assets, the return on stockholders' equity, and the return on common stockholders' equity for the years 2016 and 2017. Round percentages to one decimal place. 2017 2015 $197,000 80,000 32,000 16,000 Return on total assets Return on stockholders' equity Return on common stockholders' equity b. The profitability ratios indicate that the company's profitability has improved stockholders' equity in both years, there must be positive % 2016 Since the rate of return on total assets is less than leverage from the use of debt. the return on

Profitability Ratios The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 2017, 2016, and 2015: December 31 2016 $221,000 80,000 32,000 16,000 Notes payable (0% interest) Common stock Preferred 4 stock, $100 par the change during year) 2017 $245,000 80,000 32,000 16,000 Retained earnings 101,650 70,710 40,000 The 2017 net income was $31,610, and the 2016 net income was $23,350. No dividends on common stock were declared between 2015 and 2017. Preferred dividen were declared and paid in full in 2016 and 2017. Determine the return on total assets, the return on stockholders' equity, and the return on common stockholders' equity for the years 2016 and 2017. Round percentages to one decimal place. 2017 2015 $197,000 80,000 32,000 16,000 Return on total assets Return on stockholders' equity Return on common stockholders' equity b. The profitability ratios indicate that the company's profitability has improved stockholders' equity in both years, there must be positive % 2016 Since the rate of return on total assets is less than leverage from the use of debt. the return on

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Wrofitability Ratios The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 2017, 2016, and 2015: December 31 Notes payable (0% interest) Common stock Preferred 4% stock, $100 par (he change during year) 2017 $245,000 80,000 32,000 16,000 Retained earnings 2016 $221,000 80,000 32,000 16,000 101,650 70,710 40,000 The 2017 net income was $31,610, and the 2016 net income was $23,350. No dividends on common stock were declared between 2015 and 2017. Preferred dividen were declared and paid in full in 2016 and 2017. a. Determine the return on total assets, the return on stockholders equity, and the return on common stockholders' equity for the years 2016 and 2017. Round percentages to one decimal place. 2017 2015 $197,000 80,000 32,000 16,000 Return on total assets Return on stockholders' equity Return on common stockholders' equity b. The profitability ratios indicate that the company's profitability has improved stockholders' equity in both years, there must be positive % 2016 Since the rate of return on total assets is less than leverage from the use of debt. the return on
Transcribed Image Text:Wrofitability Ratios The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 2017, 2016, and 2015: December 31 Notes payable (0% interest) Common stock Preferred 4% stock, $100 par (he change during year) 2017 $245,000 80,000 32,000 16,000 Retained earnings 2016 $221,000 80,000 32,000 16,000 101,650 70,710 40,000 The 2017 net income was $31,610, and the 2016 net income was $23,350. No dividends on common stock were declared between 2015 and 2017. Preferred dividen were declared and paid in full in 2016 and 2017. a. Determine the return on total assets, the return on stockholders equity, and the return on common stockholders' equity for the years 2016 and 2017. Round percentages to one decimal place. 2017 2015 $197,000 80,000 32,000 16,000 Return on total assets Return on stockholders' equity Return on common stockholders' equity b. The profitability ratios indicate that the company's profitability has improved stockholders' equity in both years, there must be positive % 2016 Since the rate of return on total assets is less than leverage from the use of debt. the return on
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