Multiple Choice Question 67

The following data are provided:

December 31

2018

2017

Cash$ 1650000

$ 985000

Accounts receivable (net)1450000

1300000

Inventories2500000

2250000

Plant assets (net)8000000

6550000

Accounts payable1100000

820000

Income taxes payable190000

100000

Bonds payable1500000

1500000

10% Preferred stock, $50 par1900000

1900000

Common stock, $10 par2500000

1900000

Paid-in capital in excess of par

1700000

1200000

Retained earnings3800000

3400000

Net credit sales13000000

Cost of goods sold8500000

Operating expenses3050000

Net income1500000

Additional information:

Depreciation included in cost of goods sold and operating expenses is $1220000. On May 1, 2018, 60000 shares of common stock were issued. The preferred stock is cumulative. The preferred dividends were declared during 2018.

The return on common stock equity for 2018 is

1500 8000.

1310 7250.

1310 8000.

1500 7250.