Total assets Notes payable (8% Interest) Common stock Preferred 5% stock, $100 par (no change during year) Retained earnings 20Y7 $230,000 80,000 32,000 16,000 debt. December 31 20Y6 $207,000 80,000 32,000 16,000 82,495 60,705 48,000 The 2017 net income was $22,590, and the 2016 net income was $13,505. No dividends on common stock were declared between 20Y! and 2017. Preferred dividends 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 year 2016 and 2017. Round percentages to one decimal place. 20Y7 Return on total assets Return on stockholders' equity Return on common stockholders' equity b. The profitability ratios indicate that the company's profitability has % 20Y5 $184,000 80,000 32,000 16,000 % % 20Y6 the return on stockholders' equity in both years, there must be l % % % Since the rate of return on total assets is leverage from the use of
Total assets Notes payable (8% Interest) Common stock Preferred 5% stock, $100 par (no change during year) Retained earnings 20Y7 $230,000 80,000 32,000 16,000 debt. December 31 20Y6 $207,000 80,000 32,000 16,000 82,495 60,705 48,000 The 2017 net income was $22,590, and the 2016 net income was $13,505. No dividends on common stock were declared between 20Y! and 2017. Preferred dividends 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 year 2016 and 2017. Round percentages to one decimal place. 20Y7 Return on total assets Return on stockholders' equity Return on common stockholders' equity b. The profitability ratios indicate that the company's profitability has % 20Y5 $184,000 80,000 32,000 16,000 % % 20Y6 the return on stockholders' equity in both years, there must be l % % % Since the rate of return on total assets is leverage from the use of
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Total assets
Notes payable (8% Interest)
Common stock
Preferred 5% stock, $100 par
(no change during year)
20Y7
$230,000
80,000
32,000
16,000
Return on total assets
Return on stockholders' equity
Return on common stockholders' equity
December 31
20Y6
$207,000
80,000
32,000
16,000
Retained earnings
82,495
48,000
The 2017 net income was $22,590, and the 2016 net income was $13,505. No dividends on common stock were declared between 2015
and 2017. Preferred dividends were declared and paid in full in 2016 and 2017.
debt.
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.
60,705
20Y7
b. The profitability ratios indicate that the company's profitability has
%
20Y5
$184,000
80,000
32,000
16,000
%
%
20Y6
the return on stockholders' equity in both years, there must be
%
%
%
Since the rate of return on total assets is
leverage from the use of
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