Refer to the information for Somerville Company below. Assume a tax rate of 40%. Required: Round answers
Question:
Required:
Round answers to four decimal places.
1. Calculate the average total assets.
2. Calculate the return on assets?
Transcribed Image Text:
Somerville Company Comparative Balance Sheets At December 31, 2013 and 2014 2013 2014 Assets Current assets Cash Marketable securities Accounts receivable (net) Inventories Other $2,875,000 800,000 939,776 490,000 93,000 $5,197,776 $2,580,000 700,000 690,000 260,000 74,261 $4,304,261 Total current assets Property and equipment: Land $1,575,000 1,348,800 $2,923,800 $8,121,576 $1,067,315 1,150,000 $2,217,315 $6,521,576 Building and equipment (net) Total long-term assets Total assets Liabilities and Stockholders' Equity Current liabilities: Notes payable, short term Accounts payable Current maturity of long-term debt Accrued payables $1,170,127 298,484 3,000 200,000 $1,671,611 $ 543,641 101,500 2,000 57,780 S 704,921 Total current liabilities Long-term liabilities Bonds payable, 10% 500,000 $2,171,611 500,000 $1,204,921 Total liabilities Stockholders' equity: Preferred stock, $25 par, 8% Common stock, $1.50 par Additional paid-in capital* Retained earnings $1,000,000 337,500 2,000,000 2,612,465 $5,949,96.5 $8,121,576 $1,000,000 337,500 2,000,000 1,979,155 $5,316,655 S6,521,576 Total stockholders' equity Total liabilities and stockholders' equity For common stock only
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Cornerstones of managerial accounting
ISBN: 978-1133943983
5th edition
Authors: Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
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