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The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 20Y7, 20Y6, and 20Y5: December 31 Total assets Notes payable (8% interest) Common stock Preferred 7% stock, $100 par (no change during year) Retained earnings 20Y7 $263,000 90,000 36,000 18,000 20Y6 $237,000 90,000 36,000 18,000 20Y7 83,380 66,140 54,000 The 2017 net income was $18,500, and the 20Y6 net income was $13,400. No dividends on common stock were declared between 20Y5 and 20Y7. Preferred dividends were declared and paid in full in 20Y6 and 20Y7. a. Determine the return on total assets, the return on stockholders' equity, and the return on common stockholders' equity for the years 20Y6 and 20Y7. Round percentages to one decimal place. Return on total assets Return on stockholders' equity Return on common stockholders' equity b. The profitability ratios indicate that the company's profitability has on stockholders' equity in both years, there must be % 2015 $211,000 90,000 36,000 18,000 % % 20Y6 % % % Since the rate of return on total assets is leverage from the use of debt. the return

The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 20Y7, 20Y6, and 20Y5: December 31 Total assets Notes payable (8% interest) Common stock Preferred 7% stock, $100 par (no change during year) Retained earnings 20Y7 $263,000 90,000 36,000 18,000 20Y6 $237,000 90,000 36,000 18,000 20Y7 83,380 66,140 54,000 The 2017 net income was $18,500, and the 20Y6 net income was $13,400. No dividends on common stock were declared between 20Y5 and 20Y7. Preferred dividends were declared and paid in full in 20Y6 and 20Y7. a. Determine the return on total assets, the return on stockholders' equity, and the return on common stockholders' equity for the years 20Y6 and 20Y7. Round percentages to one decimal place. Return on total assets Return on stockholders' equity Return on common stockholders' equity b. The profitability ratios indicate that the company's profitability has on stockholders' equity in both years, there must be % 2015 $211,000 90,000 36,000 18,000 % % 20Y6 % % % Since the rate of return on total assets is leverage from the use of debt. the return

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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Profitability Ratios The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 20Y7, 20Y6, and 20Y5: Total assets Notes payable (8% interest) Common stock Preferred 7% stock, $100 par (no change during year) Retained earnings 20Y7 $263,000 90,000 36,000 18,000 December 31 Check My Work 3 more Check My Wars 20Y6 $237,000 90,000 36,000 18,000 83,380 66,140 54,000 The 2017 net income was $18,500, and the 20Y6 net income was $13,400. No dividends on common stock were declared between 20Y5 and 20Y7. Preferred dividends were declared and paid in full in 20Y6 and 20Y7. K 20Y7 a. DeTermine the return on total assets, the return on stockholders' equity, and the return on common stockholders' equity for the years 20Y6 and 20Y7. Round percentages to one decimal place. Return on total assets Return on stockholders' equity Return on common stockholders' equity b. The profitability ratios indicate that the company's profitability has on stockholders' equity in both years, there must be % 20Y5 $211,000 90,000 36,000 18,000 % % 20Y6 % % % . Since the rate of return on total assets is leverage from the use of debt. the return
Transcribed Image Text:Profitability Ratios The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 20Y7, 20Y6, and 20Y5: Total assets Notes payable (8% interest) Common stock Preferred 7% stock, $100 par (no change during year) Retained earnings 20Y7 $263,000 90,000 36,000 18,000 December 31 Check My Work 3 more Check My Wars 20Y6 $237,000 90,000 36,000 18,000 83,380 66,140 54,000 The 2017 net income was $18,500, and the 20Y6 net income was $13,400. No dividends on common stock were declared between 20Y5 and 20Y7. Preferred dividends were declared and paid in full in 20Y6 and 20Y7. K 20Y7 a. DeTermine the return on total assets, the return on stockholders' equity, and the return on common stockholders' equity for the years 20Y6 and 20Y7. Round percentages to one decimal place. Return on total assets Return on stockholders' equity Return on common stockholders' equity b. The profitability ratios indicate that the company's profitability has on stockholders' equity in both years, there must be % 20Y5 $211,000 90,000 36,000 18,000 % % 20Y6 % % % . Since the rate of return on total assets is leverage from the use of debt. the return
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