Question
Financial data for Joel de Paris, Incorporated, for last year follow: Joel de Paris, Incorporated Balance Sheet Beginning Balance Ending Balance Assets Cash $ 125,000
Financial data for Joel de Paris, Incorporated, for last year follow:
Joel de Paris, Incorporated Balance Sheet | ||
Beginning Balance | Ending Balance | |
---|---|---|
Assets | ||
Cash | $ 125,000 | $ 127,000 |
Accounts receivable | 338,000 | 471,000 |
Inventory | 564,000 | 474,000 |
Plant and equipment, net | 873,000 | 868,000 |
Investment in Buisson, S.A. | 391,000 | 430,000 |
Land (undeveloped) | 249,000 | 250,000 |
Total assets | $ 2,540,000 | $ 2,620,000 |
Liabilities and Stockholders' Equity | ||
Accounts payable | $ 388,000 | $ 338,000 |
Long-term debt | 1,005,000 | 1,005,000 |
Stockholders' equity | 1,147,000 | 1,277,000 |
Total liabilities and stockholders' equity | $ 2,540,000 | $ 2,620,000 |
Joel de Paris, Incorporated Income Statement | ||
Sales | $ 4,992,000 | |
---|---|---|
Operating expenses | 4,243,200 | |
Net operating income | 748,800 | |
Interest and taxes: | ||
Interest expense | $ 130,000 | |
Tax expense | 195,000 | 325,000 |
Net income | $ 423,800 |
The company paid dividends of $293,800 last year. The Investment in Buisson, S.A., on the balance sheet represents an investment in the stock of another company. The company's minimum required rate of return of 15%.
Required:
1. Compute the company's average operating assets for last year.
2. Compute the companys margin, turnover, and return on investment (ROI) for last year. (Round "Margin", "Turnover" and "ROI" to 2 decimal places.)
3. What was the companys residual income last year?
decimal places.) 3. What was the company's residual income last year? 1. Average operating assets 2. Margin % 2. Turnover 2. ROI % 3. Residual incomeStep by Step Solution
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