1) | Average operating assets | 1860000 | |||||||
2) | Margin = net operating income/sales | ||||||||
Turnover = sales/average operating assets | |||||||||
ROI = margin * turnover | |||||||||
Margin | 13.0% | ||||||||
turnover | 2.70 | ||||||||
ROI | 35.1% | ||||||||
total operating assets don't include investments in other companies or in undeveloped | |||||||||
land | |||||||||
ending | Beginning | ||||||||
balances | balances | ||||||||
Cash | 130,000 | 126,000 | |||||||
account receivable | 481,000 | 333,000 | |||||||
inventory | 479,000 | 573,000 | |||||||
plant and equipment,net | 790,000 | 808,000 | |||||||
total Assets | 1,880,000 | 1,840,000 | |||||||
Average operating assets = ( ending balances + beginning balances )/2 | |||||||||
(1,880,000+1,840,000)/2 | |||||||||
1860000 | |||||||||
3) | Net operating income | 652,860 | |||||||
minimum required return | 15% | ||||||||
residual income | 373860 | answer | |||||||
Residual income =net operating income - (average operating assets *min required return) | |||||||||
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance...
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance Ending Balance Assets Cash $ 128,000 $ 127,000 Accounts receivable 333,000 476,000 Inventory 563,000 479,000 Plant and equipment, net 816,000 798,000 Investment in Buisson, S.A. 395,000 429,000 Land (undeveloped) 252,000 245,000 Total assets $ 2,487,000 $ 2,554,000 Liabilities and Stockholders' Equity Accounts payable $ 373,000 $ 339,000 Long-term debt 1,016,000 1,016,000 Stockholders' equity 1,098,000 1,199,000 Total liabilities and stockholders' equity $...
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance Ending Balance Assets Cash Accounts receivable Inventory Plant and equipment, net Investment in Buisson, S.A. Land (undeveloped) Total assets Liabilities and Stockholders' Equity Accounts payable Long-term debt Stockholders' equity Total liabilities and stockholders' equity $ 127,000 338,000 569,000 866,000 391,000 253,000 $ 2,544,000 $ 130,000 483,000 480,000 847,000 435,000 249,000 $2,624,000 $ 379,000 1,007,000 1,158,000 $ 2,544,000 $ 348,000 1,007,000 1,269,000...
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance Ending Balance Assets Cash $ 129,000 $ 132,000 Accounts receivable 340,000 479,000 Inventory 577,000 476,000 Plant and equipment, net 794,000 793,000 Investment in Buisson, S.A. 401,000 427,000 Land (undeveloped) 255,000 249,000 Total assets $ 2,496,000 $ 2,556,000 Liabilities and Stockholders' Equity Accounts payable $ 389,000 $ 344,000 Long-term debt 971,000 971,000 Stockholders' equity 1,136,000 1,241,000 Total liabilities and stockholders' equity $...
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance Ending Balance Assets Cash $ 127,000 $ 136,000 Accounts receivable 349,000 484,000 Inventory 569,000 490,000 Plant and equipment, net 835,000 810,000 Investment in Buisson, S.A. 394,000 433,000 Land (undeveloped) 251,000 249,000 Total assets $ 2,525,000 $ 2,602,000 Liabilities and Stockholders' Equity Accounts payable $ 387,000 $ 346,000 Long-term debt 952,000 952,000 Stockholders' equity 1,186,000 1,304,000 Total liabilities and stockholders' equity $...
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance Ending Balance Assets Cash $ 135,000 $ 128,000 Accounts receivable 348,000 471,000 Inventory 561,000 485,000 Plant and equipment, net 836,000 836,000 Investment in Buisson, S.A. 403,000 428,000 Land (undeveloped) 251,000 249,000 Total assets $ 2,534,000 $ 2,597,000 Liabilities and Stockholders' Equity Accounts payable $ 377,000 $ 339,000 Long-term debt 1,024,000 1,024,000 Stockholders' equity 1,133,000 1,234,000 Total liabilities and stockholders' equity $...
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance Ending Balance Assets Cash Accounts receivable Inventory Plant and equipment, net Investment in Buisson, S.A. Land (undeveloped) Total assets Liabilities and Stockholders' Equity Accounts payable Long-term debt Stockholders' equity Total liabilities and stockholders' equity $ 136,000 339,000 571,000 814,000 401,000 249,000 $ 2,510,000 $ 135,000 483,000 480,000 802,000 432,000 254,000 $ 2,586,000 $ 374,000 967,000 1,169,000 $ 2,510,000 $ 335,000 967,000...
Financial data for Joel de Paris, Inc., for last year follow: Ending Balance $ Joel de Paris, Inc. Balance Sheet Beginning Balance Assets Cash 131,000 Accounts receivable 341,000 Inventory 577,000 Plant and equipment, net 851,000 Investment in Buisson, S.A. 403,000 Land (undeveloped) 252,000 Total assets $ 2,555,000 Liabilities and Stockholders' Equity Accounts payable $ 381,000 Long-term debt 1,034,000 Stockholders' equity 1,140,000 Total liabilities and stockholders' equity $ 2,555,000 129,000 489,000 475,000 847,000 427,000 248,000 2,615,000 $ $ 335,000 1,034,000 1,246,000...
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance Ending Balance Assets Cash Accounts receivable Inventory Plant and equipment, net Investment in Buisson, S.A. Land (undeveloped) Total assets Liabilities and Stockholders' Equity Accounts payable Long-term debt Stockholders' equity Total liabilities and stockholders' equity 131,000 334,000 560,000 865,000 407,000 251,000 $ 2,548,000 $ 135,000 480,000 470,000 845,000 433,000 247,000 $ 2,610,000 $ 383,000 973,000 1,192,000 $ 2,548,000 $ 332,000 973,000 1,305,000...
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance Ending Balance Assets Cash $ 130,000 $ 139,000 Accounts receivable 344,000 486,000 Inventory 565,000 473,000 Plant and equipment, net 821,000 802,000 Investment in Buisson, S.A. 401,000 431,000 Land (undeveloped) 249,000 250,000 Total assets $ 2,510,000 $ 2,581,000 Liabilities and Stockholders' Equity Accounts payable $ 384,000 $ 346,000 Long-term debt 1,008,000 1,008,000 Stockholders' equity 1,118,000 1,227,000 Total liabilities and stockholders' equity $...
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance Ending Balance Assets Cash $ 138,000 $ 132,000 Accounts receivable 340,000 485,000 Inventory 575,000 482,000 Plant and equipment, net 797,000 791,000 Investment in Buisson, S.A. 405,000 430,000 Land (undeveloped) 249,000 248,000 Total assets $ 2,504,000 $ 2,568,000 Liabilities and Stockholders' Equity Accounts payable $ 382,000 $ 347,000 Long-term debt 968,000 968,000 Stockholders' equity 1,154,000 1,253,000 Total liabilities and stockholders' equity $...