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Six Measures of Solvency or Profitability The following data were taken from the financial statements of Gates Inc. for the current fiscal year. $1,202,600 Property, plant, and equipment (net) Liabilities: Current liabilities $173,000 Note payable, 6%, due in 15 years 859,000 $1,032,000 Total liabilities Stockholders' equity $619,200 Preferred $4 stock, $100 par (no change during year) Common stock, $10 par (no change during year) 619,200 Retained earnings: Balance, beginning of year $660,000 Net income 314,000 $974,000 Preferred dividends $24,768 123,632 148,400 Common dividends Balance, end of year 825,600 Total stockholders' equity $2,064,000 $19,922,100 Sales Interest expense $51,540 Retained earnings: Balance, beginning of year $660,000 Net income $974,000 314,000 Preferred dividends $24,768 Common dividends 123,632 148,400 Balance, end of year 825,600 Total stockholders' equity $2,064,000 $19,922,100 Sales $51,540 Interest expense Assuming that total assets were $2,941,000 at the beginning of the current fiscal year, determine the following. When required, round to one decimal place. a. Ratio of fixed assets to long-term liabilities b. Ratio of liabilities to stockholders' equity c. Asset turnover d. Return on total assets % e. Return on stockholders' equity % f. Return on common stockholders' equity

Six Measures of Solvency or Profitability The following data were taken from the financial statements of Gates Inc. for the current fiscal year. $1,202,600 Property, plant, and equipment (net) Liabilities: Current liabilities $173,000 Note payable, 6%, due in 15 years 859,000 $1,032,000 Total liabilities Stockholders' equity $619,200 Preferred $4 stock, $100 par (no change during year) Common stock, $10 par (no change during year) 619,200 Retained earnings: Balance, beginning of year $660,000 Net income 314,000 $974,000 Preferred dividends $24,768 123,632 148,400 Common dividends Balance, end of year 825,600 Total stockholders' equity $2,064,000 $19,922,100 Sales Interest expense $51,540 Retained earnings: Balance, beginning of year $660,000 Net income $974,000 314,000 Preferred dividends $24,768 Common dividends 123,632 148,400 Balance, end of year 825,600 Total stockholders' equity $2,064,000 $19,922,100 Sales $51,540 Interest expense Assuming that total assets were $2,941,000 at the beginning of the current fiscal year, determine the following. When required, round to one decimal place. a. Ratio of fixed assets to long-term liabilities b. Ratio of liabilities to stockholders' equity c. Asset turnover d. Return on total assets % e. Return on stockholders' equity % f. Return on common stockholders' equity

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter16: Financial Statement Analysis
Section: Chapter Questions
Problem 13E: Ratio of liabilities to stockholders equity and times interest earned The following data were taken...
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Six Measures of Solvency or Profitability The following data were taken from the financial statements of Gates Inc. for the current fiscal year. $1,202,600 Property, plant, and equipment (net) Liabilities: Current liabilities $173,000 Note payable, 6%, due in 15 years 859,000 $1,032,000 Total liabilities Stockholders' equity $619,200 Preferred $4 stock, $100 par (no change during year) Common stock, $10 par (no change during year) 619,200 Retained earnings: Balance, beginning of year $660,000 Net income 314,000 $974,000 Preferred dividends $24,768 123,632 148,400 Common dividends Balance, end of year 825,600 Total stockholders' equity $2,064,000 $19,922,100 Sales Interest expense $51,540
Transcribed Image Text:Six Measures of Solvency or Profitability The following data were taken from the financial statements of Gates Inc. for the current fiscal year. $1,202,600 Property, plant, and equipment (net) Liabilities: Current liabilities $173,000 Note payable, 6%, due in 15 years 859,000 $1,032,000 Total liabilities Stockholders' equity $619,200 Preferred $4 stock, $100 par (no change during year) Common stock, $10 par (no change during year) 619,200 Retained earnings: Balance, beginning of year $660,000 Net income 314,000 $974,000 Preferred dividends $24,768 123,632 148,400 Common dividends Balance, end of year 825,600 Total stockholders' equity $2,064,000 $19,922,100 Sales Interest expense $51,540
Retained earnings: Balance, beginning of year $660,000 Net income $974,000 314,000 Preferred dividends $24,768 Common dividends 123,632 148,400 Balance, end of year 825,600 Total stockholders' equity $2,064,000 $19,922,100 Sales $51,540 Interest expense Assuming that total assets were $2,941,000 at the beginning of the current fiscal year, determine the following. When required, round to one decimal place. a. Ratio of fixed assets to long-term liabilities b. Ratio of liabilities to stockholders' equity c. Asset turnover d. Return on total assets % e. Return on stockholders' equity % f. Return on common stockholders' equity
Transcribed Image Text:Retained earnings: Balance, beginning of year $660,000 Net income $974,000 314,000 Preferred dividends $24,768 Common dividends 123,632 148,400 Balance, end of year 825,600 Total stockholders' equity $2,064,000 $19,922,100 Sales $51,540 Interest expense Assuming that total assets were $2,941,000 at the beginning of the current fiscal year, determine the following. When required, round to one decimal place. a. Ratio of fixed assets to long-term liabilities b. Ratio of liabilities to stockholders' equity c. Asset turnover d. Return on total assets % e. Return on stockholders' equity % f. Return on common stockholders' equity
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