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Use the following balance sheet and income statement to calculate the firm's operating return on assets (operating profits/total assets): Balance Sheet Assets: Income Statement Cash $9,000 Sales (all credit) $255,000 Accounts Receivable $26,000 Cost of Goods Sold $(153,000) Inventories Land $19,500 $49,000 Operating Expenses $(45,000) Other Fixed Assets $70,000 Depreciation $(3,000) Liabilities & Owners' Equity Interest Expense $(9,000) Accounts Payable $12,000 Long Term Debt $53,400 Taxes $(15,300) Common Stock $2,000 Paid in Capital $80,000 Retained Earnings $26,100 a) 40.0% b) 33.0% c) 27.5% d) 62.6% e) 31.1%

Use the following balance sheet and income statement to calculate the firm's operating return on assets (operating profits/total assets): Balance Sheet Assets: Income Statement Cash $9,000 Sales (all credit) $255,000 Accounts Receivable $26,000 Cost of Goods Sold $(153,000) Inventories Land $19,500 $49,000 Operating Expenses $(45,000) Other Fixed Assets $70,000 Depreciation $(3,000) Liabilities & Owners' Equity Interest Expense $(9,000) Accounts Payable $12,000 Long Term Debt $53,400 Taxes $(15,300) Common Stock $2,000 Paid in Capital $80,000 Retained Earnings $26,100 a) 40.0% b) 33.0% c) 27.5% d) 62.6% e) 31.1%

Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter15: Financial Statement Analysis
Section: Chapter Questions
Problem 6MCQ
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Use the following balance sheet and income statement to calculate the firm's operating return on assets (operating profits/total assets): Balance Sheet Assets: Income Statement Cash $9,000 Sales (all credit) $255,000 Accounts Receivable $26,000 Cost of Goods Sold $(153,000) Inventories Land $19,500 $49,000 Operating Expenses $(45,000) Other Fixed Assets $70,000 Depreciation $(3,000) Liabilities & Owners' Equity Interest Expense $(9,000) Accounts Payable $12,000 Long Term Debt $53,400 Taxes $(15,300) Common Stock $2,000 Paid in Capital $80,000 Retained Earnings $26,100 a) 40.0% b) 33.0% c) 27.5% d) 62.6% e) 31.1%
Transcribed Image Text:Use the following balance sheet and income statement to calculate the firm's operating return on assets (operating profits/total assets): Balance Sheet Assets: Income Statement Cash $9,000 Sales (all credit) $255,000 Accounts Receivable $26,000 Cost of Goods Sold $(153,000) Inventories Land $19,500 $49,000 Operating Expenses $(45,000) Other Fixed Assets $70,000 Depreciation $(3,000) Liabilities & Owners' Equity Interest Expense $(9,000) Accounts Payable $12,000 Long Term Debt $53,400 Taxes $(15,300) Common Stock $2,000 Paid in Capital $80,000 Retained Earnings $26,100 a) 40.0% b) 33.0% c) 27.5% d) 62.6% e) 31.1%
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