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the answer I got that was wrong was 9.84.. Analysis of ROE Components The comparative income statement and balance sheet of Cowan Kitchen Counters, Inc.
the answer I got that was wrong was 9.84..
Analysis of ROE Components The comparative income statement and balance sheet of Cowan Kitchen Counters, Inc. are shown. Cowan Kitchen Counters, Inc. Comparative Income Statement For Years Ended December 31, 20-2 and 20-1 20-2 $2,584,000 1,868,200 Cost of goods sold Gross profit Operating expenses Other expense (interest) Income tax expense $715,800 315,200 24,200 176,800 $199,600 20-1 $2,163,000 1,616,800 $546,200 221,800 24,200 106,300 $193,900 Net income Cowan Kitchen Counters, Inc. Comparative Balance Sheet December 31, 20-2 and 20-1 20-2 Cash $255,400 Government notes 250,000 Accounts receivable (net) 903,500 Merchandise inventory 983,600 Supplies and prepayments 143,200 Land 108,200 Building (net) 330,000 Office equipment (net) 17,700 Total assets $2,991,600 20-1 $243,200 250,000 797,500 913,600 47,500 108,200 390,600 15,000 $2,765,600 Current liabilities (accounts payable) Bonds payable $703,000 220,000 $923,000 $532,000 240,000 $772,000 Total liabilities Common stock ($10 par, 180,000 shares) $1,800,000 268,600 $1,800,000 193,600 Retained earnings Total stockholders' equity $2,068,600 $1,993,600 Total liabilities and stockholders' equity $2,991,600 $2,765,600 Compute ROE for 20-2 using its three basic components (round all calculations to two decimal places). %Step by Step Solution
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