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Financial data for Guyer Corporation, for last year follow: Guyer Corporation Balance Sheet Beginning Balance Ending Balance Assets Cash $ 140,000 $ 120,000 Accounts receivable
Financial data for Guyer Corporation, for last year follow:
Guyer Corporation Balance Sheet | ||||||
Beginning Balance | Ending Balance | |||||
Assets | ||||||
Cash | $ | 140,000 | $ | 120,000 | ||
Accounts receivable | 450,000 | 530,000 | ||||
Inventory | 320,000 | 380,000 | ||||
Plant and equipment, net | 680,000 | 640,000 | ||||
Investment in ABC, Inc. | 250,000 | 280,000 | ||||
Land (undeveloped) | 180,000 | 170,000 | ||||
Total assets | $ | 2,020,000 | $ | 2,120,000 | ||
Liabilities and Stockholders' Equity | ||||||
Accounts payable | $ | 360,000 | $ | 310,000 | ||
Long-term debt | 1,500,000 | 1,500,000 | ||||
Stockholders' equity | 160,000 | 310,000 | ||||
Total liabilities and stockholders' equity | $ | 2,020,000 | $ | 2,120,000 | ||
Guyer Corporation Income Statement | |||||||||
Sales | $ | 4,050,000 | |||||||
Operating expenses | 3,610,000 | ||||||||
Net operating income | 440,000 | ||||||||
Interest and taxes: | |||||||||
Interest expense | $ | 150,000 | |||||||
Tax expense | 110,000 | 260,000 | |||||||
Net income | $ | 180,000 | |||||||
The company paid dividends of $15,000 last year. The Investment in ABC, Inc. on the balance sheet represents an investment in the stock of another company. The company's minimum required rate of return of 9%.
What was the companys residual income last year?
Multiple Choice
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$249,200
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$-10,800
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$293,300
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$33,300
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