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Use this balance sheet and income statement to answer the following question. Use ending balances whenever average balances are required for computing ratios. National Textile
Use this balance sheet and income statement to answer the following question. Use ending balances whenever average balances are required for computing ratios.
National Textile | |||||
Balance Sheet | |||||
December 31, 20x5 | |||||
Assets | Liabilities | ||||
Current assets | $ 12,000 | Current liabilities | $ 8,000 | ||
Investments | 2,000 | Long-term liabilities | 2,000 | ||
Property, plant, and equipment | 16,000 | Total liabilities | $ 10,000 | ||
Intangible assets | 10,000 | ||||
Owner's Equity | |||||
Jonah Jones, Capital | 30,000 | ||||
Total liabilities and | |||||
Total assets | $40,000 | owner's equity | $40,000 | ||
National Textile | |
Income Statement | |
For the Year Ended December 31, 20x5 | |
Net sales | $48,000 |
Cost of goods sold | 16,000 |
Gross margin | $32,000 |
Operating expenses | 22,400 |
Net income | $ 9,600 |
The return on assets for National Textile is
30 percent. 150 percent. 33-1/3 percent. 24 percent.
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