Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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 $228,000 $205,000 $182,000
Notes payable (8% interest) 80,000 80,000 80,000
Common stock 32,000 32,000 32,000
Preferred 3% stock, $100 par 16,000 16,000 16,000
(no change during year)
Retained earnings 97,100 66,610 48,000

The 20Y7 net income was $30,970, and the 20Y6 net income was $19,090. 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 % %

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Applications Of Accounting Information Systems

Authors: David M. Shapiro

1st Edition

194999158X, 9781949991581

More Books

Students also viewed these Accounting questions

Question

Coping with competitive pressure and sport performance anxiety

Answered: 1 week ago