Use the financial statements of Gagnon, Inc., in Short Exercises compute these profitability measures for 2010. Show each computation.

Company Acid-Test Ratio
Horner, Inc. (Utility).............................................. 0.73
Isaacson Company (Department store)................... 0.68
Jona Companies Limited (Grocery store)............... 0.72
a. Rate of return on sales.
b. Rate of return on total assets.
c. Rate of return on common stockholdersequity.

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Gagnon, Inc. Balance Sheets (Adapted) December 31, 2010 and 2009 Increase (Decrease Dollar amounts in millions 2010 2009 Amount Percenta Assets Current Assets Cash and cash equivalents Short-term investments Receivables, net Inventories Prepaid expenses and other assets $1,203 S 903 300 33.2 % 84 (77) (91.7) 246 256 (10) (3.9) 12.3 203343 140 (40.8) 5.0 6.6 1,089 841 248 29.5 14.8 91 81 10 Total current a Property, plant, and equipment, net Intangible a Other assets 1,750 1,667 3,619 3,396223 83 824 718 106 Total assets S7.282 S6,622 $660 10.0 % Liabilities and Stockholders' Equity Current Liabilities Accounts payable Income tax payable Short-term debt Other $977 $884 $93 10.5 % 69 (30) (43.5) 5.2 70 73 (3) (4.1) 5.8 3,544 2,982562 18.8 12.5 5,928 5,169 75914.7 39 121 115 Total current liabilities Long-term debt Other liabilities 1,207 1,141 1,177 1,046 131 Total liabilit Stockholders' Equity Common stock Retained earnings Accumulated other comprehensive (loss) 1,513 1,629 (116 (7.1) (159)(17617 9.7 1,354 1453 (99) (6.8) Total stockholders' equity S7.282 10.0 %