Question: Utilizing the following information on the Smithwick Company, Compute the firms return on equity. Income Statement (000s) Net sales $ 12,750 Cost of sales 7,650

Utilizing the following information on the Smithwick Company, Compute the firm€™s return on equity.

Income Statement
(000s)
Net sales $ 12,750
Cost of sales 7,650
Gross margin $ 5,100
Operating expenses 3,165
Earnings before interest and taxes 1,935
Interest 235
Earnings before tax $ 1,700
Taxes (40%) 680
Earnings after tax $1,020

Balance Sheet (000s) Current assets S 1,500 Current liabilities S 910 7000 Long tem labilities S 8,500 Fixed assets 1,200 Common stock at par) Paid in capital Retained earnings 2,000 1,000 3.390 S 8,500

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