Trend Analysis Critelli Company has provided the following comparative information: Year 5 Year 4 Year 3 Year 2 Year 1 Net income $1,352,800 $1,166,200 $980,000 $837,600 $709,800 Interest expense 460,000 419,800 362,600 276,400 220,000 Income tax expense 432,896 326,536 274,400 217,776 170,352 Average total assets 9,960,440 8,811,111 7,542,697 6,439,306 5,501,775 Average stockholders' equity 3,340,247 3,013,437 2,655,827 2,372,805 2,093,805 You have been asked to evaluate the historical performance of the company over the last five years. Selected industry ratios have remained relatively steady at the following levels for the last five years: Industry Ratios Return on total assets 17.9 % Return on stockholders' equity 37.3 % Times interest earned 4.6 Instructions: Calculate three ratios for Year 1 through Year 5. Round to one decimal place. a. Return on total assets: Year 5 Year 4 Year 3 Year 2 Year 1 b. Return on stockholders' equity: Year 5 Year 4 Year 3 Year 2 Year 1 c. Times interest earned: Year 5 Year 4 Year 3 Year 2 Year 1
Trend Analysis Critelli Company has provided the following comparative information: Year 5 Year 4 Year 3 Year 2 Year 1 Net income $1,352,800 $1,166,200 $980,000 $837,600 $709,800 Interest expense 460,000 419,800 362,600 276,400 220,000 Income tax expense 432,896 326,536 274,400 217,776 170,352 Average total assets 9,960,440 8,811,111 7,542,697 6,439,306 5,501,775 Average stockholders' equity 3,340,247 3,013,437 2,655,827 2,372,805 2,093,805 You have been asked to evaluate the historical performance of the company over the last five years. Selected industry ratios have remained relatively steady at the following levels for the last five years: Industry Ratios Return on total assets 17.9 % Return on stockholders' equity 37.3 % Times interest earned 4.6 Instructions: Calculate three ratios for Year 1 through Year 5. Round to one decimal place. a. Return on total assets: Year 5 Year 4 Year 3 Year 2 Year 1 b. Return on stockholders' equity: Year 5 Year 4 Year 3 Year 2 Year 1 c. Times interest earned: Year 5 Year 4 Year 3 Year 2 Year 1
Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Chapter4: Profitability Analysis
Section: Chapter Questions
Problem 23PC
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![Trend Analysis
Critelli Company has provided the following comparative information:
Year 5
Year 4
Year 3
Year 2
Year 1
Net income
$1,352,800
$1,166,200
$980,000
$837,600
$709,800
Interest expense
460,000
419,800
362,600
276,400
220,000
Income tax expense
432,896
326,536
274,400
217,776
170,352
Average total assets
9,960,440
8,811,111
7,542,697
6,439,306
5,501,775
Average stockholders' equity
3,340,247
3,013,437
2,655,827
2,372,805
2,093,805
You have been asked to evaluate the historical performance of the company over the last five years.
Selected industry ratios have remained relatively steady at the following levels for the last five years:
Industry Ratios
Return on total assets
17.9 %
Return on stockholders' equity
37.3 %
Times interest earned
4.6
Instructions:
Calculate three ratios for Year 1 through Year 5. Round to one decimal place.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F12676721-58b1-4130-8e06-d426ed10d57c%2F0619d363-380c-4ce4-a61d-e43fdd04b93a%2Fn3nvbtl_processed.png&w=3840&q=75)
Transcribed Image Text:Trend Analysis
Critelli Company has provided the following comparative information:
Year 5
Year 4
Year 3
Year 2
Year 1
Net income
$1,352,800
$1,166,200
$980,000
$837,600
$709,800
Interest expense
460,000
419,800
362,600
276,400
220,000
Income tax expense
432,896
326,536
274,400
217,776
170,352
Average total assets
9,960,440
8,811,111
7,542,697
6,439,306
5,501,775
Average stockholders' equity
3,340,247
3,013,437
2,655,827
2,372,805
2,093,805
You have been asked to evaluate the historical performance of the company over the last five years.
Selected industry ratios have remained relatively steady at the following levels for the last five years:
Industry Ratios
Return on total assets
17.9 %
Return on stockholders' equity
37.3 %
Times interest earned
4.6
Instructions:
Calculate three ratios for Year 1 through Year 5. Round to one decimal place.
![a. Return on total assets:
Year 5
Year 4
Year 3
Year 2
Year 1
b. Return on stockholders' equity:
Year 5
Year 4
Year 3
Year 2
Year 1
c. Times interest earned:
Year 5
Year 4
Year 3
Year 2
Year 1](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F12676721-58b1-4130-8e06-d426ed10d57c%2F0619d363-380c-4ce4-a61d-e43fdd04b93a%2Fm703iid_processed.png&w=3840&q=75)
Transcribed Image Text:a. Return on total assets:
Year 5
Year 4
Year 3
Year 2
Year 1
b. Return on stockholders' equity:
Year 5
Year 4
Year 3
Year 2
Year 1
c. Times interest earned:
Year 5
Year 4
Year 3
Year 2
Year 1
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