Total liabilities and stockholders' equity Joel de Paris, Incorporated Income Statement Sales Operating expenses Net operating income Interest and taxes: Interest expense Tax expense Net Income $ 150,000 110,000 1. Average operating assets 2. Margin 2. Turnover 2 ROI 3 Residual income $4,050,000 3,645,000 405,000 The company paid dividends of $15,000 last year. The "Investment in Buisson, S.A.," on the balance sheet represents an investment in the stock of another company. The company's minimum required rate of return is 15%. $ 2,020,000 > 2,100,000 260,000 $ 145,000 Required: 1. Compute the company's average operating assets for last year. 2. Compute the company's margin, turnover, and return on investment (ROI) for last year. Note: Round "Turnover" to 1 decimal place. 3. What was the company's residual income last year? % %
Total liabilities and stockholders' equity Joel de Paris, Incorporated Income Statement Sales Operating expenses Net operating income Interest and taxes: Interest expense Tax expense Net Income $ 150,000 110,000 1. Average operating assets 2. Margin 2. Turnover 2 ROI 3 Residual income $4,050,000 3,645,000 405,000 The company paid dividends of $15,000 last year. The "Investment in Buisson, S.A.," on the balance sheet represents an investment in the stock of another company. The company's minimum required rate of return is 15%. $ 2,020,000 > 2,100,000 260,000 $ 145,000 Required: 1. Compute the company's average operating assets for last year. 2. Compute the company's margin, turnover, and return on investment (ROI) for last year. Note: Round "Turnover" to 1 decimal place. 3. What was the company's residual income last year? % %
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Financial data for Joel de Paris, Incorporated, for last year follow:
Joel de Paris, Incorporated
Balance Sheet
Assets
Cash
Accounts receivable
Inventory
Plant and equipment, net
Investment in Buisson, S.A.
Land (undeveloped)
Total assets
Liabilities and Stockholders' Equity
Accounts payable.
Long-term debt
Stockholders' equity
Total liabilities and stockholders' equity
Joel de Paris, Incorporated
Income Statement
Sales
Operating expenses
Net operating income
Interest and taxes:
Interest expense
Tax expense
Net income
$ 150,000
110,000
Beginning
Balance
$ 4,050,000
3,645,000
405,000
$ 140,000
450,000
250,000
180,000
$ 2,020,000
260,000
$ 145,000
320,000
680,000
$360,000
1,500,000
160,000
$ 2,020,000
Ending Balance
$ 120,000
530,000
380,000
620,000
280,000
170,000
$ 2,100,000
$ 310,000
1,500,000
290,000
$ 2,100,000
Transcribed Image Text:Total liabilities and stockholders' equity
Joel de Paris, Incorporated
Income Statement
Sales
Operating expenses
Net operating income.
Interest and taxes:
Interest expense
Tax expense
Net income
$ 150,000
110,000
1. Average operating assets
2. Margin
2. Turnover
2 R01
3. Residual income
$ 4,050,000
3,645,000
405,000
$2,020,000 >2,100,000
260,000
$ 145,000
The company paid dividends of $15,000 last year. The "Investment in Buisson, S.A.," on the balance sheet represents an investment in
the stock of another company. The company's minimum required rate of return is 15%.
Required:
1. Compute the company's average operating assets for last year.
2. Compute the company's margin, turnover, and return on investment (ROI) for last year.
Note: Round "Turnover" to 1 decimal place.
3. What was the company's residual income last year?
%
%
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