Exercise 14-8 Selected comparative statement data for Queen Products Company are
ID: 2332877 • Letter: E
Question
Exercise 14-8 Selected comparative statement data for Queen Products Company are presented below. All balance sheet data are as of December 31. 2017 2016 Net sales Cost of goods sold Interest expense Net income Accounts receivable Inventory Total assets Total common stockholders' equity $760,500 $724,000 439,500 5,700 44,500 107,000 78,700 495,600 328,400 482,500 6,800 46,500 117,500 82,700 580,700 429,500 Compute the following ratios for 2017, (Round answers to 1 decimal place, e.g. 1.6, or 1.6% .) Profit margin Asset turnover times Return on assets Return on common stockholders' equityExplanation / Answer
Answers
Profit Margin
A
Net Income
$ 46,500.00
B
Net Sales
$ 760,500.00
C = (A/B) x 100
Profit Margin
6.1%
Asset Turnover
A
Net Sales
$ 760,500.00
B
Beginning Total Assets
$ 495,600.00
C
Ending Total Assets
$ 580,700.00
D = (B+C)/2
Average Total Assets
$ 538,150.00
E=A/D
Asset Turnover Ratio
1.4 times
Return on Assets
A
Net Income
$ 46,500.00
B
Average Total Assets
$ 538,150.00
C = (A/B) x 100
Return on Assets
8.6%
Return on Common Stockholder's Equity
A
Net Income
$ 46,500.00
B
Beginning common stockholder's equity
$ 328,400.00
C
Ending common stockholder's equity
$ 429,500.00
D = (B+C)/2
Average common stockholder's equity
$ 378,950.00
E=A/D
Return on Common Stockholder's Equity
12.3%
Profit Margin
A
Net Income
$ 46,500.00
B
Net Sales
$ 760,500.00
C = (A/B) x 100
Profit Margin
6.1%
Asset Turnover
A
Net Sales
$ 760,500.00
B
Beginning Total Assets
$ 495,600.00
C
Ending Total Assets
$ 580,700.00
D = (B+C)/2
Average Total Assets
$ 538,150.00
E=A/D
Asset Turnover Ratio
1.4 times
Return on Assets
A
Net Income
$ 46,500.00
B
Average Total Assets
$ 538,150.00
C = (A/B) x 100
Return on Assets
8.6%
Return on Common Stockholder's Equity
A
Net Income
$ 46,500.00
B
Beginning common stockholder's equity
$ 328,400.00
C
Ending common stockholder's equity
$ 429,500.00
D = (B+C)/2
Average common stockholder's equity
$ 378,950.00
E=A/D
Return on Common Stockholder's Equity
12.3%
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