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Profitability Ratios The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 2017, 2016, and 2015: December 31
Profitability Ratios The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 2017, 2016, and 2015: December 31 2017 2016 20Y5 Total assets $167,000 $150,000 $133,000 Notes payable (8% interest) 60,000 60,000 60,000 Common stock 24,000 24,000 24,000 Preferred 4% stock, $100 par 12,000 12,000 12,000 (no change during year) Retained earnings 71,380 49,330 35,000 The 2017 net income was $22,530, and the 2016 net Income was $13,810. No dividends on common stock were declared between 2015 and 2017. Preferred dividends were declared and paid in full in 2016 and 2017. a. Determine the return on total assets, the return on stockholders' equity, and the return on common stockholders' equity for the years 2016 and 2017. When required, round to one decimal place. Return on total assets Return on stockholders' equity Return on common stockholders' equity 2017 % b. The profitability ratios indicate that the company's profitability has debt. % 2016 % % % % . Since the return on assets is the return on stockholders' equity in both years, there must be leverage from the use of
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