The following financial statements apply to the next six problems, 13s.12-13s.18. Inland Manufacturing Balance Sheet (Dollars in millions) December 31, 2011, December 31, 2010 Cash $400 $300 Account receivables 560 450 | Inventory 790 550 Total current assets $1,750 $1,300 Total fixed assets 1,200 1,210 Total assets $2,950 $2,510 Inland Manufacturing Income Statement December 31, 2011 (continued) Account payable Note payable $350 $250 (Dollars in Millions) 470 330 Labor 850 Other current liabilities 220 130 Overhead 230 Total current liabilities $1,040 $710 Depreciation Gross profit 400 $1,710 Long-term debt Common equity Total liabilities and equity 580 580 $740 $1,330 $1,220 Selling expenses General and administrative expenses 40 $2,950 $2,510 60 $640 Eanings before interest and taxes (EBIT) Interest expenses Inland Manufacturing Income Statement December 31, 2011 (Dollars in Millions) 25 Earnings before income taxes Provision for income taxes (40%) Gross sales $2,450 $615 Cost of goods sold: 246 Materials $230 Net income $369

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Calculate the return on equity.
(a) 14%               (b) 29%
(c) 15%               (d) None of the above

The following financial statements apply to the next six problems, 13s.12-13s.18.
Inland Manufacturing Balance Sheet
(Dollars in millions)
December 31, 2011, December 31, 2010
Cash
$400
$300
Account receivables
560
450
| Inventory
790
550
Total current assets
$1,750
$1,300
Total fixed assets
1,200
1,210
Total assets
$2,950
$2,510
Inland Manufacturing Income Statement December 31, 2011 (continued)
Account payable
Note payable
$350
$250
(Dollars in Millions)
470
330
Labor
850
Other current liabilities
220
130
Overhead
230
Total current liabilities
$1,040
$710
Depreciation
Gross profit
400
$1,710
Long-term debt
Common equity
Total liabilities and equity
580
580
$740
$1,330
$1,220
Selling expenses
General and administrative expenses
40
$2,950
$2,510
60
$640
Eanings before interest and taxes (EBIT)
Interest expenses
Inland Manufacturing Income Statement December 31, 2011
(Dollars in Millions)
25
Earnings before income taxes
Provision for income taxes (40%)
Gross sales
$2,450
$615
Cost of goods sold:
246
Materials
$230
Net income
$369
Transcribed Image Text:The following financial statements apply to the next six problems, 13s.12-13s.18. Inland Manufacturing Balance Sheet (Dollars in millions) December 31, 2011, December 31, 2010 Cash $400 $300 Account receivables 560 450 | Inventory 790 550 Total current assets $1,750 $1,300 Total fixed assets 1,200 1,210 Total assets $2,950 $2,510 Inland Manufacturing Income Statement December 31, 2011 (continued) Account payable Note payable $350 $250 (Dollars in Millions) 470 330 Labor 850 Other current liabilities 220 130 Overhead 230 Total current liabilities $1,040 $710 Depreciation Gross profit 400 $1,710 Long-term debt Common equity Total liabilities and equity 580 580 $740 $1,330 $1,220 Selling expenses General and administrative expenses 40 $2,950 $2,510 60 $640 Eanings before interest and taxes (EBIT) Interest expenses Inland Manufacturing Income Statement December 31, 2011 (Dollars in Millions) 25 Earnings before income taxes Provision for income taxes (40%) Gross sales $2,450 $615 Cost of goods sold: 246 Materials $230 Net income $369
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