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 Accounts receivable Inventory Plant and equipment, net Investment in Buisson, S.A. Land (undeveloped) Total assets Liabilities and Stockholders' Equity Accounts payable Long-term debt Stockholders' equity Total liabilities and stockholders' equity $ 136,000 338,000 570.000 826,000 405,000 253,000 $ 2,528,000 $ 138,000 487,000 483,000 802,000 434,000 251,000 $2,595,000 $ 373,000 1,048,000 1,107,000 $2,528,000 $ 344,000 1,048,000 1,203,000 $2,595,000 Joel de Paris, Inc. Income Statement Sales Operating expenses Net operating income Interest and taxes: Interest expense $ 121,000 Tax expense 201,000 Net income $ 4,158,000 3,617,460 540, 540 322,000 218,540 $ The company paid dividends of $122,540 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 company's margin, turnover, and return on investment (ROI) for last year. (Round "Margin", "Turnover" and "ROI" to 2 decimal places.) 3. What was the company's residual income last year? 1. Average operating assets Margin Turnover ROI Residual income