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Item2 10points eBook Print References Check my workCheck My Work button is now enabled Item 2 Item 2 10 points Item Skipped Problem 11-15 Return

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Problem 11-15 Return on Investment (ROI) and Residual Income [LO11-1, LO11-2]

Financial data for Joel de Paris, Inc., for last year follow:

Joel de Paris, Inc. Balance Sheet
Beginning Balance Ending Balance
Assets
Cash $ 126,000 $ 128,000
Accounts receivable 339,000 480,000
Inventory 577,000 475,000
Plant and equipment, net 878,000 877,000
Investment in Buisson, S.A. 394,000 432,000
Land (undeveloped) 254,000 249,000
Total assets $ 2,568,000 $ 2,641,000
Liabilities and Stockholders' Equity
Accounts payable $ 376,000 $ 347,000
Long-term debt 988,000 988,000
Stockholders' equity 1,204,000 1,306,000
Total liabilities and stockholders' equity $ 2,568,000 $ 2,641,000

Joel de Paris, Inc. Income Statement
Sales $ 4,268,000
Operating expenses 3,499,760
Net operating income 768,240
Interest and taxes:
Interest expense $ 118,000
Tax expense 200,000 318,000
Net income $ 450,240

The company paid dividends of $348,240 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?

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Complete this question by entering your answers in the tabs below. Required A Required B Prepare a Merchandise Purchases Budget for November and December. November December Merchandise Purchases Budget Cost of goods sold Total needs Required purchases

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