Show Me How 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 2015 Total assets $5,200,000 $5,000,000 $4,000,000 Notes payable (6% interest) 2,500,000 2,500,000 2,500,000 Common stock 250,000 250,000 250,000 Preferred 2.5% stock, $100 p (no change during 500,000 500,000 500,000 year) Retained earnings 1,574,000 1,222,000 750,000 2017 2016 8.06 x% 8.06% 19.13% 26.64 The 2017 net income was $411,000, and the 2016 net income was $462,500. No dividends on common stock were declared between 2015 and 2017, Preferred divide 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, Round per Return on total assets Betum on stockholders' equity Rum on common stockholders' equity 24.18 36.41 b. The profitability ratios indicate that the company's profitability has deteriorated. leverage from the use of debt. Because the return on common stockholders' equity exceeds the Feedback Check My Work Divide the sum of net income plus interest expeme by average total assets. Average total assets (Beginning total assets + Ending total assets) 2 Divide net income by average total stockholders'equity. Average total stackeruty(Beginning total stockholdery'equity Ending total stockholders equity). Divide net income minus preferred dividends try average common stockholders/equity Common stockholders/equity Cummon stock Retained earnings Average cam stockholders equity Ending common stockholders' equity) +2. b. Consider what the ratios tell you about the company's performance Check My Work 62 2 0 54 3 4 #3 35 5 dty A 66 6 7 8