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The balance sheets at the end of each of the first two years of operations indicate the following: 2011 $560,000 40,000 2012 $600,000 60,000 900,000 125,000 350,000 100,000 600,000 75,000 310,000 Total current assets Total investments Total property, plant, and equipment Total current liabilities 700,000 65,000 250,000 100,000 600,000 75,000 Total long-term liabilities Preferred 9% stock, $100 par Common stock, $10 par Paid-in capital in excess of par-common stock Retained earnings 210,000 If net income is $115,000 and interest expense is $30,000 for 2012, what is the rate earned on stockholders' equity for 2012 (round percent to one decimal point)? 10.6% 3. a. 11.1% b. 12.4% c. 14.0% d. LO: 17-03 OBJ: Easy Bloom's: Knowledge DIF: PTS: 1 ANS: B KEY: NAT: BUSPROG: Analytic

The balance sheets at the end of each of the first two years of operations indicate the following: 2011 $560,000 40,000 2012 $600,000 60,000 900,000 125,000 350,000 100,000 600,000 75,000 310,000 Total current assets Total investments Total property, plant, and equipment Total current liabilities 700,000 65,000 250,000 100,000 600,000 75,000 Total long-term liabilities Preferred 9% stock, $100 par Common stock, $10 par Paid-in capital in excess of par-common stock Retained earnings 210,000 If net income is $115,000 and interest expense is $30,000 for 2012, what is the rate earned on stockholders' equity for 2012 (round percent to one decimal point)? 10.6% 3. a. 11.1% b. 12.4% c. 14.0% d. LO: 17-03 OBJ: Easy Bloom's: Knowledge DIF: PTS: 1 ANS: B KEY: NAT: BUSPROG: Analytic

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The balance sheets at the end of each of the first two years of operations indicate the following: 2011 $560,000 40,000 2012 $600,000 60,000 900,000 125,000 350,000 100,000 600,000 75,000 310,000 Total current assets Total investments Total property, plant, and equipment Total current liabilities 700,000 65,000 250,000 100,000 600,000 75,000 Total long-term liabilities Preferred 9% stock, $100 par Common stock, $10 par Paid-in capital in excess of par-common stock Retained earnings 210,000
Transcribed Image Text:The balance sheets at the end of each of the first two years of operations indicate the following: 2011 $560,000 40,000 2012 $600,000 60,000 900,000 125,000 350,000 100,000 600,000 75,000 310,000 Total current assets Total investments Total property, plant, and equipment Total current liabilities 700,000 65,000 250,000 100,000 600,000 75,000 Total long-term liabilities Preferred 9% stock, $100 par Common stock, $10 par Paid-in capital in excess of par-common stock Retained earnings 210,000
If net income is $115,000 and interest expense is $30,000 for 2012, what is the rate earned on stockholders' equity for 2012 (round percent to one decimal point)? 10.6% 3. a. 11.1% b. 12.4% c. 14.0% d. LO: 17-03 OBJ: Easy Bloom's: Knowledge DIF: PTS: 1 ANS: B KEY: NAT: BUSPROG: Analytic
Transcribed Image Text:If net income is $115,000 and interest expense is $30,000 for 2012, what is the rate earned on stockholders' equity for 2012 (round percent to one decimal point)? 10.6% 3. a. 11.1% b. 12.4% c. 14.0% d. LO: 17-03 OBJ: Easy Bloom's: Knowledge DIF: PTS: 1 ANS: B KEY: NAT: BUSPROG: Analytic
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