Use the following financial statement information as of the end of each year: Inventory Current assets Total assets Current liabilities Total liabilities 2017 ($) 2016 ($) 54,000 48,000 81,000 106,000 392,000 336,000 27,000 36,000 102,000 88,000 Preferred stock Net sales Total stockholders' equity 290,000 248,000 10,000 10,000 784,000 697,000 Cost of goods sold 306,000 277,000 Net income 34,000 90,000 Tax expense 22,000 18,000 Interest expense 12,000 12,000 Dividends paid to preferred stockholders 2,000 2,000 Dividends paid to common shareholders 1,000 Compute the profit margin for 2017. 1,000 a. 8.9%. b. 4.3%. c. 8.4%. d. 11.7%.
Use the following financial statement information as of the end of each year: Inventory Current assets Total assets Current liabilities Total liabilities 2017 ($) 2016 ($) 54,000 48,000 81,000 106,000 392,000 336,000 27,000 36,000 102,000 88,000 Preferred stock Net sales Total stockholders' equity 290,000 248,000 10,000 10,000 784,000 697,000 Cost of goods sold 306,000 277,000 Net income 34,000 90,000 Tax expense 22,000 18,000 Interest expense 12,000 12,000 Dividends paid to preferred stockholders 2,000 2,000 Dividends paid to common shareholders 1,000 Compute the profit margin for 2017. 1,000 a. 8.9%. b. 4.3%. c. 8.4%. d. 11.7%.
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter12: Fainancial Statement Analysis
Section: Chapter Questions
Problem 54CE
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Transcribed Image Text:Use the following financial statement information as of the end of each year:
Inventory
Current assets
Total assets
Current liabilities
Total liabilities
2017 ($) 2016 ($)
54,000 48,000
81,000 106,000
392,000 336,000
27,000 36,000
102,000 88,000
Preferred stock
Net sales
Total stockholders' equity
290,000 248,000
10,000 10,000
784,000 697,000
Cost of goods sold
306,000 277,000
Net income
34,000 90,000
Tax expense
22,000 18,000
Interest expense
12,000 12,000
Dividends paid to preferred stockholders 2,000 2,000
Dividends paid to common shareholders 1,000
Compute the profit margin for 2017.
1,000
a. 8.9%.
b. 4.3%.
c. 8.4%.
d. 11.7%.
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