Question
Six Measures of Solvency or Profitability The following data were taken from the financial statements of Gates Inc. for the current fiscal year. Property, plant,
Six Measures of Solvency or Profitability The following data were taken from the financial statements of Gates Inc. for the current fiscal year. Property, plant, and equipment (net) $1,848,000 Liabilities: Current liabilities $176,000 Note payable, 6%, due in 15 years 880,000 Total liabilities $1,056,000 Stockholders' equity: Preferred $2 stock, $100 par (no change during year) $1,056,000 Common stock, $10 par (no change during year) 1,056,000 Retained earnings: Balance, beginning of year $1,126,000 Net income 439,000 $1,565,000 Preferred dividends $21,120 Common dividends 135,880 157,000 Balance, end of year 1,408,000 Total stockholders' equity $3,520,000 Sales $28,107,450 Interest expense $52,800 Assuming that total assets were $4,347,000 at the beginning of the current fiscal year, determine the following. When required, round to one decimal place. a. Ratio of fixed assets to long-term liabilities b. Ratio of liabilities to stockholders' equity c. Asset turnover d. Return on total assets % e. Return on stockholders equity % f. Return on common stockholders' equity %
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