Need to Solve the bottom Return on common stockholders\' equity Exercise 13-11 P

Question

Need to Solve the bottom

Return on common stockholders' equity

Exercise 13-11 Profitability analysis LO P3 Simon Company's year-end balance sheets follow 2016 2015 At December 31 Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Liabilities and Equity Accounts payable Long-term notes payable secured by 2017 s 31,200 34,200 37,000 90,000 64,700 57,700 31,840 84,40058,500 3,267 420,845 262,336 143,533 S585,000 $455,000 $300,000 11,115 9,364 $144,208 76, 895 39,996 mortgages on plant assets Common stock, $10 par value Retained earnings Total liabilities and equity 107,780 104,650 66, 963 162,500 162,500 162,500 30, 541 S585,000 $455,000 $300,000 170,512 110,955 The company's income statements for the years ended December 31, 2017 and 2016, follow 2017 2016 For Year Ended December 31 Sales Cost of goods sold Other operating expenses Interest expense Income taxes Total costs and expenses Net income $760,500 S541,450 $463,905 235, 755 12,929 9, 887 $351,943 136,987 12,453 8,122 722,476 $ 38,024 $ 2.34 509,505 $ 31,945 $ 1.97 Earnings per share Additional information about the company follows Common stock market price, December 31, 2017 Common stock market price, December 31, 2016 Annual cash dividends per share in 2017 Annual cash dividends per share in 2016 $32.00 30.00 0.20 0.10

Explanation / Answer

Return on Common stockholders Equity Choose Nemerator Choose Denominator Net income - Preference dividends / Average common stockholders Equity = ROCE 2017 38024 - 0 /                                                                303,234 = 12.54% 2016 31945 - 0 /                                                                233,248 = 13.70%

Related Questions

Navigate

• Browse (All)
• Browse N
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.