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The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: Cash Accounts receivable, net Merchandise inventory Prepaid expenses $ 22,000 200,000 320,000 10,000 552,000 830,000 Total current assets Property and equipment, net Total assets $1,382,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 230,000 330,000 Bonds payable, 12% Total liabilities Stockholders' equity: Common stock, $10 par value Retained earnings 560,000 $ 130,000 692,000 Total stockholders' equity 822,000 Total liabilities and stockholders' equity $1,382,000 Castile Products, Inc. Income Statement For the Year Ended December 31 Sales Cost of goods sold $2,270,000 1,240,000 Gross margin Selling and administrative expenses 1,030,000 640,000 Net operating income Interest expense 390,000 39,600 Net income before taxes 350,400 105,120 Income taxes (30%) Net income $ 245,280 Account balances at the beginning of the year were: accounts receivable, $180,000; and inventory, $350,000. All sales were on account. Assets at the beginning of the year totaled $1,010,000, and the stockholders' equity totaled $705,000.

The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: Cash Accounts receivable, net Merchandise inventory Prepaid expenses $ 22,000 200,000 320,000 10,000 552,000 830,000 Total current assets Property and equipment, net Total assets $1,382,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 230,000 330,000 Bonds payable, 12% Total liabilities Stockholders' equity: Common stock, $10 par value Retained earnings 560,000 $ 130,000 692,000 Total stockholders' equity 822,000 Total liabilities and stockholders' equity $1,382,000 Castile Products, Inc. Income Statement For the Year Ended December 31 Sales Cost of goods sold $2,270,000 1,240,000 Gross margin Selling and administrative expenses 1,030,000 640,000 Net operating income Interest expense 390,000 39,600 Net income before taxes 350,400 105,120 Income taxes (30%) Net income $ 245,280 Account balances at the beginning of the year were: accounts receivable, $180,000; and inventory, $350,000. All sales were on account. Assets at the beginning of the year totaled $1,010,000, and the stockholders' equity totaled $705,000.

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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Please answer sub questiom 3 and 4

1. Gross margin percentage. (Round your percentage answer to 2 decimal places (i.e., 0.1234 should be entered as 12.34).) Gross margin percentage 45.37 % 2. Net profit margin percentage. (Round your answer to the nearest whole percentage place (i.e., 0.1234 should be entered as 12%).) Net profit margin percentage 11 % 3. Return on total assets. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) Return on total assets 17.7 % 4. Return on equity. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) Return on equity 35.5 %
Transcribed Image Text:1. Gross margin percentage. (Round your percentage answer to 2 decimal places (i.e., 0.1234 should be entered as 12.34).) Gross margin percentage 45.37 % 2. Net profit margin percentage. (Round your answer to the nearest whole percentage place (i.e., 0.1234 should be entered as 12%).) Net profit margin percentage 11 % 3. Return on total assets. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) Return on total assets 17.7 % 4. Return on equity. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) Return on equity 35.5 %
The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: $ 22,000 200,000 320,000 10,000 Cash Accounts receivable, net Merchandise inventory Prepaid expenses Total current assets 552,000 830,000 Property and equipment, net Total assets $1,382,000 Liabilities and Stockholders' Equity Liabilities: $ 230,000 330,000 Current liabilities Bonds payable, 12% Total liabilities 560,000 Stockholders' equity: Common stock, $10 par value Retained earnings $ 130,000 692,000 Total stockholders' equity 822,000 Total liabilities and stockholders' equity $1,382,000 Castile Products, Inc. Income Statement For the Year Ended December 31 Sales Cost of goods sold $2,270,000 1,240,000 Gross margin Selling and administrative expenses 1,030,000 640,000 390,000 39,600 Net operating income Interest expense 350,400 105,120 Net income before taxes Income taxes (30%) Net income $ 245,280 Account balances at the beginning of the year were: accounts receivable, $180,000; and inventory. $350,000. All sales were on account. Assets at the beginning of the year totaled $1,010,000, and the stockholders' equity totaled $705,000.
Transcribed Image Text:The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: $ 22,000 200,000 320,000 10,000 Cash Accounts receivable, net Merchandise inventory Prepaid expenses Total current assets 552,000 830,000 Property and equipment, net Total assets $1,382,000 Liabilities and Stockholders' Equity Liabilities: $ 230,000 330,000 Current liabilities Bonds payable, 12% Total liabilities 560,000 Stockholders' equity: Common stock, $10 par value Retained earnings $ 130,000 692,000 Total stockholders' equity 822,000 Total liabilities and stockholders' equity $1,382,000 Castile Products, Inc. Income Statement For the Year Ended December 31 Sales Cost of goods sold $2,270,000 1,240,000 Gross margin Selling and administrative expenses 1,030,000 640,000 390,000 39,600 Net operating income Interest expense 350,400 105,120 Net income before taxes Income taxes (30%) Net income $ 245,280 Account balances at the beginning of the year were: accounts receivable, $180,000; and inventory. $350,000. All sales were on account. Assets at the beginning of the year totaled $1,010,000, and the stockholders' equity totaled $705,000.
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