Retum Ratios and Leverage The following selected data are taken from the financial statements of Cedar Industries: $641,000 379,000 Sales revenue Cost of goods sold Gross profit Selling and administrative expense $ 262,000 100,000 Operating income $162,000 Interest expense 50,000 Income before tax $112,000 Income tax expense (40%) 44,800 Net income $67,200 Accounts payable $45,000 70,000 Accrued liabilities Income taxes payable 10,000 Interest payable 25,000 Short-term loans payable 150,000 Total current liabilities $300,000 Long-term bonds payable $500,000 Preferred stock, 10%, $100 par $250,000 Common stock, no par 600,000 350,000 Retained earnings Total stockholders' equity $1,200,000 Total liabilities and stockholders' equity $2,000,000 Required: 1. Compute the following ratios for Cedar Industries: a. Return on sales b. Asset turnover (Assume that total assets at the beginning of the year were $1,600,000.) c. Return on assets d. Return on common stockholders' equity (Assume that the only changes in stockholders' equity during the year were from the net income for the year and dividends on the preferred stock.) When computing percentage amounts, carry out calculations to four decimal places, but enter your answers to two decimal places; for example, .17856 rounds to .1786 and would be entered as 17.86. a. Return on sales % b. Asset turnover (round to 2 decimal places) times c. Return on assets % d. Return on common stockholders' equity % 2. Comment on Evergreen's use of leverage. Has it successfully employed leverage