CLICK HERE TO SAVE YOUR WORK 838 H A 3 Question 1 - 11 marks 4 5 Q1. Financial data for Summerland Company for last year appear below: 6 7 Summerland Company 8 Statements of Financial Position 9 TETTE 10 Beginning Balance DL 11 Assets: 12 Cash $50,000 $72,000 13 Accounts receivable 20,000 26,000 14 Inventory 30,000 36,000 15 Plant and equipment (net) 120,000 112,000 16 Investment in ABC Company 80,000 100,000 17 Land (underdeveloped) 170,000 170.000 18 Total assets $470.000 S510.000 19 20 Liabilities and owners' equity 21 Accounts payable $70,000 $90,000 22 Long-term deby 250,000 250,000 23 Owners' equity 150,000 170.000 TURITIUITUUWHETS 24 $470.000 S510,000 25 26 Summerland Company 27 Income Statement 28 Sales 414,000 29 Less operating expenses 351.900 30 Net operating income 62.100 31Less interest and taxes Instructions SECTION 2 SECTION 3 SECTION 4 SECTION 5 SECTION 6 FC Owne H De Merge Cell CONY CLICK HERE TO SAVE YOUR WORK 38 H A 19 20 Liabilities and owners' equity 21 Accounts payable $70,000 590.000 22 Long-term deby 250.000 250.000 23 Owners' equity 150.000 170,000 24 TOUT TOIMITETTO $470.000 S510,000 25 26 Summerland Company 27 Income Statement 28 Sales $414,000 29 Less operating expenses 351 900 30 Net operating income 62,100 31 Less interest and taxes: 32 Interest expense $30,000 33 Tax expense 10.000 40.000 34 Operating Income $22.100 35 36 The company paid dividends of $2,100 last year. The "Investment in ABC Company" on the statement of financial position 37 represents an investment in the stock of another company. 38 39 Required: 40 Show anylall workings in here: 41 a) Compute the company's Avergage Operating Assets (AOA) for last year: (3 marks) 42 3 4 5 Average Operating Assets 5 - b) Compute the company's Margin for last year: 2 marks) FORMULA SHI SECTION 6 SECTION 5 SECTION 2 SECTION 3 > Instructions SECTION 4 1 Copy Com De B CLICK HERE TO SAVE YXIR WCHOK A D 40 41) Compute the company's Averyage Operating Asseta (AOA) for last yeur (mark) Show anyfall working in here 42 45 Average Operating Assets 40 47 b) Compute the company's Margin for last year: (2 marks) 48 49 50 51 Margin 52 S3) Compute the company's Tumover for last year: (2 marks) SS 56 57 Turnover 58 59 d) Compute the company's Return on Investment (ROI) for last year: (2 marks) TO 51 2 3 ROI e) The Board of Directors of the Company have set a minimum required retum of 20%. What was the company's residual income last year? (2 marks) SECTIONG FORMULA SHIWW SECTION 3 SECTIONS SECTION 2 SECTION 4 Instructions 48 49 50 51 Margin 52 53 c) Compute the company's Tumover for last year: (2 marks) 54 55 56 57 Turnover 58 59 d) Compute the company's Return on Investment (ROI) for last year: (2 marks) 60 61 62 63 ROI 64 55 e) The Board of Directors of the Company have set a minimum required return of 20%. What was the company's residual income last year? (2 marks) 7 3 6 . Residual income
