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Addai Company has provided the following comparative information: 20Y8 20Y7 20Y6 20Y5 20Y4 Net income $1,253,700 $1,080,800 $908,200 $776,200 $657,800 Interest expense 426,300 389,100 336,000
Addai Company has provided the following comparative information:
20Y8 | 20Y7 | 20Y6 | 20Y5 | 20Y4 | ||||||
Net income | $1,253,700 | $1,080,800 | $908,200 | $776,200 | $657,800 | |||||
Interest expense | 426,300 | 389,100 | 336,000 | 256,100 | 203,900 | |||||
Income tax expense | 401,184 | 302,624 | 254,296 | 201,812 | 157,872 | |||||
Total assets (ending balance) | 8,202,816 | 8,681,606 | 6,241,236 | 6,519,790 | 4,944,174 | |||||
Total stockholders' equity (ending balance) | 2,588,354 | 3,149,404 | 2,009,546 | 2,520,130 | 1,512,078 | |||||
Average total assets | 8,442,211 | 7,461,421 | 6,380,513 | 5,433,158 | 4,632,796 | |||||
Average stockholders' equity | 2,868,879 | 2,579,475 | 2,264,838 | 2,016,104 | 1,773,046 |
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:
20Y4―20Y8 | ||
Return on total assets | 19.6% | |
Return on stockholders’ equity | 40.5% | |
Times interest earned | 4.6 | |
The ratio of liabilities to stockholders' equity | 2.1 |
Required:
1. Determine the following for the years 20Y4 through 20Y8. Round to one decimal place:
a. Return on total assets:
20Y8 | fill in the blank 1% |
20Y7 | fill in the blank 2% |
20Y6 | fill in the blank 3% |
20Y5 | fill in the blank 4% |
20Y4 | fill in the blank 5% |
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