Question
Compute the Return on Net Operating Assets for year 2018 using the NOPAT/Average NOA formula. Show the formula and calculations Income Statement 2018 2017 Sales
Compute the Return on Net Operating Assets for year 2018 using the NOPAT/Average NOA formula. Show the formula and calculations
| Income Statement | 2018 | 2017 | ||
| Sales Revenue | $180,000 | $165,000 | ||
| Cost of Goods Sold | 110,000 | 100,000 | ||
| Gross Profit | 70,000 | 65,000 | ||
| Operating expenses | 53,300 | 50,400 | ||
| Interest expense | 2,700 | 2,600 | ||
| Income before income tax | 14,000 | 12,000 | ||
| Income tax expense | 4,000 | 3,000 | ||
| Net Income | $10,000 | $9,000 | ||
| Balance Sheet | 2018 | 2017 | ||
| Cash | $22,000 | $16,000 | ||
| Accounts Receivable (net) | 19,000 | 17,000 | ||
| Investments (short-term) | 3,000 | 5,000 | ||
| Inventory | 34,000 | 30,000 | ||
| Prepaid Expenses | 2,000 | 4,000 | ||
| Property, plant and equipment (net) | 45,000 | 38,000 | ||
| $125,000 | $110,000 | |||
| Accounts Payable | $19,000 | $15,000 | ||
| Interest Payable | 800 | 600 | ||
| Accrued expenses | 3,200 | 2,400 | ||
| Unearned revenue | 3,000 | 2,000 | ||
| Notes Payable (long-term) | 40,000 | 45,000 | ||
| Common Stock ($5) | 30,000 | 20,000 | ||
| Retained Earnings | $29,000 | $25,000 | ||
| $125,000 | $110,000 | |||
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