Selected year-end financial statements of Cabot Corporation follow. (All sales w

Question

Selected year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2016, were inventory, $46,900; total assets, $219,400; common stock, $87,000; and retained earnings, $41,551.) CABOT CORPORATION Income Statement For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit Operating expenses Interest expense Income before taxes Income taxes Net income $ 456,600 297,050 159,550 98,600 4,100 56,850 22,901 $ 33,949

Explanation / Answer

Return on Total Assets = Net Income / Total Assets

= 33949 / 252800

= 13.42%

Return on Equity = Net Income / Equity

= 33949 / (87000+75500)

= 20.89%

Equity = common stock + retained earnings

  

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

---

---

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