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Profitability Ratios The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 20Y7, 20Y6, and 20Y5: December 31 20Y7
Profitability Ratios
The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 20Y7, 20Y6, and 20Y5:
December 31 | |||||||
20Y7 | 20Y6 | 20Y5 | |||||
Total assets | $255,000 | $230,000 | $205,000 | ||||
Notes payable (8% interest) | 90,000 | 90,000 | 90,000 | ||||
Common stock | 36,000 | 36,000 | 36,000 | ||||
Preferred 5% stock, $100 par | 18,000 | 18,000 | 18,000 | ||||
(no change during year) | |||||||
Retained earnings | 94,500 | 68,025 | 54,000 |
The 20Y7 net income was $27,375, and the 20Y6 net income was $14,925. No dividends on common stock were declared between 20Y5 and 20Y7. Preferred dividends were declared and paid in full in 20Y6 and 20Y7.
a. Determine the return on total assets, the return on stockholders' equity, and the return on common stockholders equity for the years 20Y6 and 20Y7. When required, round to one decimal place.
20Y7 | 20Y6 | |||
Return on total assets | % | % | ||
Return on stockholders equity | % | % | ||
Return on common stockholders equity | % | % |
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