Refer to the facts described in BE 416. Show the DuPont frameworks calculation of the three components

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Refer to the facts described in BE 4–16. Show the DuPont framework’s calculation of the three components of the 2021 return on equity for Anderson TV and Appliance.


BE 4–16

The 2021 income statement for Anderson TV and Appliance reported net sales of $420,000 and net income of $65,000. Average total assets for 2021 was $800,000. Shareholders’ equity at the beginning of the year was $500,000, and $20,000 was paid to shareholders as dividends. There were no other shareholders’ equity transactions that occurred during the year. Calculate the profit margin on sales, return on assets, and return on equity for 2021.

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Intermediate Accounting

ISBN: 978-1260481952

10th edition

Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas

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