Question
TEW COMPANY Balance Sheet As of December 31 ASSETS Cash $ 20,000 Accounts receivable 80,000 Inventory 50,000 Net plant and equipment 250,000 Total assets $
TEW COMPANY
Balance Sheet As of December 31
ASSETS Cash $ 20,000
Accounts receivable 80,000
Inventory 50,000
Net plant and equipment 250,000
Total assets $ 400,000
LIABILITIES AND STOCKHOLDERS EQUITY
Accounts payable $ 40,000
Accrued expenses 60,000
Long-term debt 130,000
Common stock 100,000
Paid-in capital 10,000
Retained earnings 60,000
Total liabilities and stockholders equity $ 400,000
TEW COMPANY
Income Statement For the year ended December 31
Sales (all on credit) $ 500,000
Cost of goods sold 200,000
Gross profit $ 300,000
Sales and administrative expenses 20,000
Fixed lease expenses 10,000
Depreciation 40,000
Operating profit $ 230,000
Interest expense 20,000
Profit before taxes $ 210,000
Taxes (35%) 73,500
Net income $ 136,500
Refer to the tables above. Using the DuPont method, return on assets (investment) for Tew is approximately ____.
Multiple Choice
34.1%
293.0%
80%
None of the options
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The Handbook Of Fixed Income Securities
Authors: Frank Fabozzi, Steven Mann, Francesco Fabozzi
9th Edition
1260473899, 978-1260473896
