Question
The comparative financial statements prepared at December 31, 2015, for Prince Company showed the following summarized data: 2015 2014 Income statement: Sales revenue $ 190,000
The comparative financial statements prepared at December 31, 2015, for Prince Company showed the following summarized data: 2015 2014 Income statement: Sales revenue $ 190,000 * $ 167,000 Cost of goods sold 112,000 100,000 Gross profit 78,000 67,000 Operating expenses and interest expense 56,000 53,000 Pretax income 22,000 14,000 Income tax 8,000 4,000 Net income $ 14,000 $ 10,000 Balance sheet: Cash $ 4,000 $ 7,000 Accounts receivable (net) 14,000 18,000 Inventory 40,000 34,000 Operational assets (net) 45,000 38,000 $ 103,000 $ 97,000 Current liabilities (no interest) $ 16,000 $ 17,000 Long-term liabilities (10% interest) 45,000 45,000 Common stock (par $5) 30,000 30,000 Retained earnings 12,000 5,000 $ 103,000 $ 97,000
g. | What was the return on assets? Answer I get is 14% but it's incorrect in connect |
h. | Compute the financial leverage percentage? Answer I get is 45% but it's incorrect in connect. Thanks |
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