Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Financial data for Bridger Inc. for last year are as follows: BRIDGER INC. Balance Sheet Ending Balance Beginning Balance Assets Cash $ 165,000 $ 160,000

Financial data for Bridger Inc. for last year are as follows:

BRIDGER INC.
Balance Sheet
Ending
Balance
Beginning
Balance
Assets
Cash$165,000$160,000
Accounts receivable390,000250,000
Inventory400,000420,000
Plant and equipment, net805,000850,000
Investment in Brier Company600,000570,000
Land (undeveloped)420,000420,000
Total assets$2,780,000$2,670,000
Liabilities and Shareholders’ Equity
Accounts payable$490,000$530,000
Long-term debt1,000,0001,000,000
Shareholders’ equity1,290,0001,140,000
Total liabilities and shareholders’ equity$2,780,000$2,670,000

BRIDGER INC.
Income Statement
Sales$4,300,000
Operating expenses3,784,000
Operating income516,000
Interest and taxes:
Interest expense$104,000
Tax expense170,000274,000
Net income$242,000


The company paid dividends of $140,000 last year. The “Investment in Brier Company” on the balance sheet represents an investment in the common shares of another company.


Required:
1. 
Compute the company’s margin, turnover, and ROI for last year. (Round your intermediate calculations and final answers to 1 decimal place.)

2. The board of directors of Bridger Inc. has set a minimum required return of 17%. What was the company’s residual income last year?

Step by Step Solution

3.40 Rating (153 Votes )

There are 3 Steps involved in it

Step: 1

To address the requirements we first need to understand and compute the various financial metrics as... 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_2

Step: 3

blur-text-image_3

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

Managerial Accounting for Managers

Authors: Eric Noreen, Peter Brewer, Ray Garrison

3rd edition

78025427, 978-0077736460, 007773646X, 978-0078025426

More Books

Students also viewed these General Management questions