Exercise 14-8 Your answer is partially correct. Try again Selected comparative s

Question

Exercise 14-8 Your answer is partially correct. Try again 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 $757,000 $722,500 441,500 4,000 38,500 123,500 108,500 73,000 501,000 431,900 321,500 481,000 6,800 52,000 89,900 575,000 Compute the following ratios for 2017, (Round answers to 1 decimal place, eg. 1.6, or 1.6% .) Profit margin 6.86 % Asset turnover 1.40 times Return on assets Return on common stockholders' equity

Explanation / Answer

1) Profit Margin = Net income / Net Sales*100

52000$/757000$*100 = 6.9 %

2)Asset Turnover = Net Sale/ Total Assets

757000$/ 575000$ =1.3 Times

3)Return on Assets= Net Income / Total Assets*100

52000$/575000$*100= 9%

4) Return on Common Stockholders Equity = Net Income / Common Stock holders Equity*100

52000$/431900$*100= 12%

  

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