Use the following information to answer this question. et sales ess: Cost of goo

Question

Use the following information to answer this question. et sales ess: Cost of goods sold $8,600 ation 400 $910 Earnings before interest and taxes Less: Interest paid Taxable Income 29 $539 Net income Windswept, Inc. 2009 and 2010 Balance Sheets (S in millions) 2009 2010 $1150 $1,20 1,25 $3190$2,89 2009 2010 $140 $175 Accounts payable 900 1,500 1535 Common stock 2,540 $ 2,410 3,240 Accounts rec ory ained earnings 700 otal Net fixed assets Total assets $5,780 $6,050Total liab. & equity What is the return on equity for 2010? O 25.35 percent 0 18.65 percent 1773 percent 15.01 percent 31.49 percent

Explanation / Answer

Return on Equity in 2010=Net income for 2010/(book value of 2009+book value of 2010)/2=539/((3190+2890)/2)=17.73%

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