MEGAFRAME COMPUTER COMPANY Balance Sheet As of December 31, 2009 ASSETS Cash Accounts Receivable Inventory Net Plant and Equipment Total Assets $ 50,000 70,000 110,000 220.000 $450,000 LIABILITIES AND STOCKHOLDERS' EQUITY Accounts Payable Accrued Expenses $ 70,000 50,000 Long-Term Debt Common Stock Paid-In Capital Retained Earnings Total Liabilities and Stockholders' Equity 130.000 70,000 40.000 90.000 $450,000 MEGAFRAME COMPUTER COMPANY Income Statement For the Year Ended December 31, 2009 $ 875.000 600.000 275.000 30,000 Sales (all on credit) Cost of Goods Sold Gross Profit Sales and Administrative Expense Depreciation Operating Profit Interest Expense Profit before Taxes Taxes (30) Net Income 56.000 190.000 25.000 165,000 49.500 $ 115.500 Refer to the figure above. The firm's return on equity is O 52.8%. 55.6%. 58.0%. O 100.0%