Question
Financial data for Stirling, Inc., for last year are as follows: Stirling, Inc. Balance Sheet Beginning Balance Ending Balance Assets Cash $ 156,000 $ 153,000
Financial data for Stirling, Inc., for last year are as follows: |
Stirling, Inc. Balance Sheet | ||||
Beginning Balance | Ending Balance | |||
Assets | ||||
Cash | $ | 156,000 | $ | 153,000 |
Accounts receivable | 385,000 | 529,000 | ||
Inventory | 631,000 | 546,000 | ||
Plant and equipment, net | 976,000 | 960,000 | ||
Investment in Brier Company | 456,000 | 480,000 | ||
Land (undeveloped) | 280,000 | 284,000 | ||
|
|
|
| |
Total assets | $ | 2,884,000 | $ | 2,952,000 |
|
|
|
| |
Liabilities and Stockholders' Equity | ||||
Accounts payable | $ | 432,000 | $ | 390,000 |
Long-term debt | 1,093,000 | 1,093,000 | ||
Stockholders' equity | 1,359,000 | 1,469,000 | ||
|
|
|
| |
Total liabilities and stockholders' equity | $ | 2,884,000 | $ | 2,952,000 |
|
|
|
| |
|
Stirling, Inc. Income Statement | |||
Sales | $ | 6,084,000 | |
Operating expenses | 5,095,520 | ||
|
| ||
Net operating income | 988,480 | ||
Interest and taxes: | |||
Interest expense | $ 181,000 | ||
Tax expense | 260,000 | 441,000 | |
|
|
| |
Net income | $ | 547,480 | |
|
| ||
|
The company paid dividends of $284,480 last year. The "Investment in Brier Company" on the balance sheet represents an investment in the stock of another company. |
Required: | |
1. | Compute the companys margin, turnover, and return on investment (ROI) for last year. (Do not round intermediate calculations. Round your Turnover answer to 2 decimal places. Round your Margin and ROI percentage answers to 2 decimal places (i.e., 0.1234 should be entered as 12.34).) |
}""":ontiipcres_dab"t},:{2"_6,"0]:[7"_6,"llnu":51"_l,ul:n6"_2,"{}":32"_e,lsfa":42"_1,:-0"_5,"-1":24"_1,:-1"_3,":05""_0,":_4,"seal:f8"_4,"llnu":37"_],1}20":77"_8,12":34"_[{":23"_e,ru:t5"_4,"1"leit%20Tew"N":mena,"}]seal:f7"_4,":34"_5,"[]":33"_},0""2":c2,"9""7":c1,"0""6":c0{"":19"_},3""2":"3",23:"2","3""2":"1",23:"0"{"":59"_],}]"}:"7""_},N"IOSTUE"Q":76"_:{5"_5,"}}""":79"_","%25":75"_:{0"_3{"":_2{"":20"_,{}}3"_rc1l_el_ce0blta0_:"8"_3,"t"ghRilety%20sseonspre:"7""_},t"ghri:"8"_6,"uetr":43"_",ONTILUSO:"6"_7{"":55"_},2}":53"_2,":21"_e,ru:t3"_6{"":55"_",ICERUM"N":73"_:{9"_2,"}}""":79"_",)~37z("~":75"_:{6"_5,""}:"9"_7,"""":75"_:{0"_3{"":_2{"":20"_,{}}""":_7,""}ONTIESQU:"6"_7{"":55"_},"}:"9"_7,"I"RO:"5"_7{"":30"_:{2""_:{0"_2{",[}]"}:"7""_},N"IOSTUE"Q":76"_:{5"_5,"}}""":79"_",:"5"_7{"":30"_:{2""_:{0"_2{"},"}r21__cllce0_leab_t"0":38"_",ermbNulety%20shtigeRylste%20nspoes"r":_7,""}htig"r":68"_e,ru:t3"_4,"N"IOUTOL"S":76"_:{5"_5,"}}:23"_5,":21"_2,"uetr":63"_:{5"_5,"C"RIMENU:"3"_7{"":29"_},"}:"9"_7,"~"6)(3~z:"5"_7{"":56"_},""":79"_",:"5"_7{"":30"_:{2""_:{0"_2{"},"}:"7""_},N"IOSTUE"Q":76"_:{5"_5,"}}""":79"_",erovrnTu:"5"_7{"":30"_:{2""_:{0"_2{",[}]"}:"7""_},N"IOSTUE"Q":76"_:{5"_5,"}}""":79"_","%25":75"_:{0"_3{"":_2{"":20"_,{}}t"ghRilety%20sseonspre:"7""_",r11__cllce0_leab_t"0":38"_},t"ghri:"8"_6,"uetr":43"_",ONTILUSO:"6"_7{"":55"_},2}":53"_2,":21"_e,ru:t3"_6{"":55"_",ICERUM"N":73"_:{9"_2,"}}""":79"_",)~35z("~":75"_:{6"_5,""}:"9"_7,"""":75"_:{0"_3{"":_2{"":20"_,{}}""":_7,""}ONTIESQU:"6"_7{"":55"_},"}:"9"_7,"n"giar"M":75"_:{0"_3{"":_2{"":20"_[{],}}""":_7,"%3B"neno:%20ayplis%20d)%3B11%2023,16,%2037(1gb%20rr:locod-unrokgac"b":_8,""}_2"0":78"_",1)21,%2063%2017,13b(rg:"9""_",ONTIESQU:"6"_7{"":55"_},"}:"9"_7,"""":75"_:{0"_3{"":_2{"":20"_,{}}""":_7,"%3B"neno:%20ayplis%20d)%3B11%2023,16,%2037(1gb%20rr:locod-unrokgac"b":_8,""}_1"0":78"_",1)21,%2063%2017,13b(rg:"9""_",ONTIESQU:"6"_7{"":55"_},"}:"9"_7,"""":75"_:{0"_3{"":_2{"":20"_,{}}""":_7,"%3B"1)21,%2063%2017,13b(rg:%20orol-cndougrckba:"8""_3,":16"_},0"0_:"8"_7,")"11%2023,16,%2037(1gb"r":_9,"N"IOSTUE"Q":76"_:{5"_5,"}}""":79"_",:"5"_7{"":30"_:{2""_:{0"_2{"[[":13"_e,lsfa":41"_},n"owpDro"d":27"_1,:-5"_2,"{}":75"_e,lsfa":82"_:{8"_2,"""":22"_e,lsfa":35"_e,ru:t6"_3,"{}":55"_",leab%20TedtltiUn:"9"_6,":37"_1,":48"_5{":[5"_6{"
2. | The board of directors of Stirling, Inc., has set a minimum required return of 14%. What was the companys residual income last year? |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started