Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Below are the two most recent balance sheets and most recent income statement for Outlook Industries. The company has an effective tax rate of 35%.

Below are the two most recent balance sheets and most recent income statement for Outlook Industries. The company has an effective tax rate of 35%. Balance Sheet 2014 2013 Assets: Cash $10,000 $6,000 Accounts Receivable (net) 6,000 1,500 Inventory 8,000 10,000 Long-lived assets 12,000 11,000 Less: Accumulated depreciation (4,000) (2,000) Total assets $32,000 $26,500 Liabilities and Stockholders Equity: Accounts payable $5,000 $6,000 Deferred revenues 1,000 2,000 Long-term note payable 10,000 10,000 Less: Discount on note payable (800) (1,000) Common stock 12,000 6,000 Retained earnings 4,800 3,500 Total liabilities and stockholders equity $32,000 $26,500 Income Statement For the year ended December 31, 2014 Sales $42,000 Cost of goods sold (24,000) Depreciation expense (2,000) Interest expense (3,000) Bad debt expense (2,000) Other expense (including income taxes) (9,000) Net income $2,000 Refer to the information for Outlook Industries. The return on common shareholders equity for Outlook Industries for 2014 is 11.9% 13.5% 10% 15.2%

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamentals Of Investments

Authors: Charles J. Corrado

3rd Edition

0072829192, 978-0072829198

More Books

Students also viewed these Finance questions

Question

4. What are the current trends in computer software platforms?

Answered: 1 week ago