The following selected data were taken from the financial statements of The O'Malley Group Inc. for December 31, 20Y5, 20Y4, and 2013: December 31 Total assets Notes payable (10% interest) Common stock Preferred $4 stock, $100 par Retained earnings 20Y5 $201,000 70,000 28,000 14,000 79,000 15,920 20Y4 $181,000 70,000 20Y5 28,000 14,000 63,000 16,940 Net income No dividends on common stock were declared between 2013 and 2015. a. Determine the return on total assets, the return on stockholders' equity, and the return on common stockholders' equity for the years 2014 and 2015. Round your percentage answers to one decimal place. % 20Y3 % $161,000 70,000 28,000 14,000 Return on total assets Return on stockholders' equity Return on common stockholders equity b. What conclusions can be drawn from these data as to the company's profitability? % 42,000 13,552 20Y4 % % % 4
The following selected data were taken from the financial statements of The O'Malley Group Inc. for December 31, 20Y5, 20Y4, and 2013: December 31 Total assets Notes payable (10% interest) Common stock Preferred $4 stock, $100 par Retained earnings 20Y5 $201,000 70,000 28,000 14,000 79,000 15,920 20Y4 $181,000 70,000 20Y5 28,000 14,000 63,000 16,940 Net income No dividends on common stock were declared between 2013 and 2015. a. Determine the return on total assets, the return on stockholders' equity, and the return on common stockholders' equity for the years 2014 and 2015. Round your percentage answers to one decimal place. % 20Y3 % $161,000 70,000 28,000 14,000 Return on total assets Return on stockholders' equity Return on common stockholders equity b. What conclusions can be drawn from these data as to the company's profitability? % 42,000 13,552 20Y4 % % % 4
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 17E
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Step 1: Introduction to ratios:
VIEWStep 2: Calculation of Average total assets.
VIEWStep 3: Calculation average Stockholders' Equity
VIEWStep 4: Calculation of Average common Stockholders' Equity
VIEWStep 5: Calculation of return on total assets
VIEWStep 6: Calculation of return on Stockholders' Equity
VIEWStep 7: Calculation of return on common Stockholders' Equity
VIEWStep 8: Final Solution
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