Required 1 : | |||||
Profit margin (%) | |||||
Choose numerator: | / | Choose denominator: | = | Profit margin | |
Net income | / | Net sales | = | Profit margin | |
180 | / | 5200 | = | 3.46% | |
Asset turnover | |||||
Choose numerator: | / | Choose denominator: | = | Asset turnover | |
Net sales | / | Average total assets | = | Asset turnover | |
5200 | / | 1800 | = | 2.89 | |
Equity multiplier | |||||
Choose numerator: | / | Choose denominator: | = | Equity multiplier | |
Average total assets | / | Average stockholders' equity | = | Equity multiplier | |
1800 | / | 525 | = | 3.43 | |
Return on Shareholders' Equity (%) | |||||
Choose numerator: | / | Choose denominator: | = | Return on Equity | |
Net income | / | Average stockholders' equity | = | Return on Equity | |
180 | / | 525 | = | 34.29% |
Working note | |
1) Average total assets for 2021 = ( Beginning total assets + Ending total assets ) / 2 = ( 1700 + 1900 ) / 2 = | 1800 |
2) | 2021 | 2020 |
Common stock | 400 | 400 |
Retained earnings | 150 | 100 |
Stockholders' equity | 550 | 500 |
Average stockholders' equity for 2021 = ( Beginning stockholders' equity + Ending stockholders' equity ) / 2 = ( 500 + 550 ) / 2 = | 525 |
Required 2 : | ||||||
Profit margin | x | Asset turnover | x | Equity multiplier | = | ROE |
3.46% | x | 2.89 | x | 3.43 | = | 34.30% |
Returr The following condensed information was reported by Peabody Toys, Inc., for 2021 and 2020: ($...
The following condensed information was reported by Peabody Toys, Inc., for 2021 and 2020: ($ in thousands) 2021 2020 $6,800 330 $5,800 156 Income statement information Net sales Net income Balance sheet information Current assets Property, plant, and equipment (net) Total assets Current liabilities Long-term liabilities Common stock Retained earnings Liabilities and shareholders' equity $ 960 2,540 $3,500 $1,680 910 600 310 $3,500 $ 910 2,190 $3,100 $1,330 910 600 260 $3,100 Required: 1. Determine the following components of the...
The following condensed information was reported by Peabody Toys, Inc., for 2021 and 2020: ($ in thousands) 2021 2020 Income statement information Net sales $ 6,600 $ 5,600 Net income 248 152 Balance sheet information Current assets $ 940 $ 890 Property, plant, and equipment (net) 2,360 2,010 Total assets $ 3,300 $ 2,900 Current liabilities $ 1,720 $ 1,370 Long-term liabilities 890 890 Common stock 400 400 Retained earnings 290 240 Liabilities and shareholders’ equity $ 3,300 $ 2,900...
Exercise 4-28 (Algo) DuPont analysis [LO4-10] The following condensed information was reported by Peabody Toys, Inc. for 2021 and 2020: ($ in thousands) 2021 2020 Income statement information $ 5,800 $4,800 136 $ 850 1.540 Net income Balance sheet information Current assets Property, plant, and equipment (net) Total assets Current liabilities Long-tem liabilities Common stock Retained earnings Liabilities and shareholders' equity $ 10 1,290 $2.100 $ 330 $2,500 $1. 180 $2,500 $2,100 Required: 1. Determine the following components of the...
The following condensed information was reported by Peabody Toys, Inc., for 2021 and 2020: ($ in thousands) 2021 2020 $6,500 450 $5,500 150 Income statement information Net sales Net income Balance sheet information Current assets Property, plant, and equipment (net) Total assets Current liabilities Long-term liabilities Common stock Retained earnings Liabilities and shareholders' equity $ 930 2,270 $3,200 $1,670 880 300 350 $3,200 $ 880 1,920 $2,800 $1,390 880 300 230 $2,800 Required: 1. Determine the following ratios for 2021:...
The following condensed information was reported by Peabody Toys, Inc., for 2021 and 2020: ($ in thousands 2021 2020 $5,600 294 $4,600 132 Income statement information Net sales Net income Balance sheet information Current assets Property, plant, and equipment (net) Total assets Current liabilities Long-term liabilities Common stock Retained earnings Liabilities and shareholders' equity $ 840 1,460 $ 2,300 $1,020 790 300 190 $ 2,300 $ 790 1,110 $1,900 $ 790 300 140 $1,900 670 Required: 1. Determine the following...
The 2021 income statement for Anderson TV and Appliance reported net sales of $360,000 and net income of $85,000. Average total assets for 2021 was $800,000. Shareholders’ equity at the beginning of the year was $500,000 and $40,000 was paid to shareholders as dividends. There were no other shareholders’ equity transactions that occurred during the year. Show the DuPont framework's calculation of the three components of the 2021 return on equity for Anderson TV and Appliance. Profit Margin (%) Choose...
260 The following condensed information was reported by Peabody Toys, Inc., for 2021 and 2020: ($ in thousands) 2021 2020 Income statement information Net sales $5,500 $4,500 Net income 130 Balance sheet information Current assets $ 830 $ 780 Property, plant, and equipment (net) 1,370 1,020 Total assets $2,200 $1,800 Current liabilities $ 540 $ 190 Long-term liabilities 780 780 Common stock 700 700 Retained earnings 180 130 Liabilities and shareholders' equity $2,200 $1,800 Required: 1. Determine the following ratios...
The following condensed information was reported by Peabody Toys, Inc. for 2021 and 2020: ($ in thousands) 2021 2020 $ 7,100 468 $ 6,100 162 Income statement information Net sales Net income Balance sheet information Current assets Property, plant, and equipment (net) Total assets Current liabilities Long-term liabilities Common stock Retained earnings Liabilities and shareholders' equity $ 990 2,810 $ 3,800 $ 2,160 940 300 400 $ 3,800 $ 940 2,460 $ 3,400 $1,870 940 300 290 $3,400 Required: 1....
17 The following condensed information was reported by Peabody Toys, Inc., for 2021 and 2020: 0.47 points ($ in thousands 2021 2020 $6,700 $5,700 288 154 eBook Income statement information Net sales Net income Balance sheet information Current assets Property, plant, and equipment (net) Total assets Current liabilities Long-term liabilities Common stock Retained earnings Liabilities and shareholders' equity $ 950 2,450 $3,400 $1,700 900 500 300 $3,400 $ 900 2,100 $3,000 $1,350 900 500 250 $3,000 Hint References Required: 1....
Brief Exercise 4-17 (Algo) Profitability ratios (LO4-10] The 2021 income statement for Anderson TV and Appliance reported net sales of $260,000 and net income of $95,000. Average total assets for 2021 was $650,000. Shareholders' equity at the beginning of the year was $350,000 and $40,000 was paid to shareholders as dividends. There were no other shareholders' equity transactions that occurred during the year. Show the DuPont framework's calculation of the three components of the 2021 return on equity for Anderson...