The simplified balance sheet and income statement for a corporation appear below.

Income Statement

For the Year Ended December 31, 2011

Net sales ……………………………..           $830,000

Cost of goods sold …………………..            500,000

Gross margin ………………………..           $330,000

Operating expenses …………………             260,000

Income before income taxes ………..            $ 70,000

Income taxes ……………………….          10,000

Net income …………………………         $ 60,000

Total assets and stockholders’ equity at the beginning of 2011 were $360,000 and $280,000, respectively. Cash flows from operating activities were $72,000.Compute the following profitability measures:

(1) Profit margin,

(2) Asset turnover,

(3) Return on assets,

(4) Cash flow yield,

(5) Cash return on assets,

(6) Debt to equity ratio,

(7) Return on equity. (Note: Round to one decimal place.)

Transcribed Image Text:

Balance Sheet December 31, 2011 Assets Liabilities Current assets nvestments Property, plant, and equipment Intangible assets $110,000 Current liabilities $ 50,000 60,000 $110,000 20,000 Long-term liabilities 293,000 otal liabilities 37,000 Stockholders' Equity Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders equity 200,000 150,000 $350,000 $460,000 Total assets $460,000