You have been asked to consider investing in ASAP Printing Services Inc.

Additional information:
Total assets at January 1, 2016, were $4,100,000.
Net income for 2016 was $420,000.
No new shares were issued in 2016.
Required Calculate the following for 2016:
1. Rate of return on total assets
2. Rate of return on common shareholders' equity
3. If the minimum rate of return for each of the above ratios is 12 percent, will you invest in this business?

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ASAP Printing Services Inc. Balance Sheet December 31,2016 Assets Liabilities Current liabilities: Current assets: Cash Accounts receivable, net Inventory Prepaid expenses Total current assets $384,000 318,000 420,000 3,600 Accounts payable Accrued liabilities Total current liabilities $90,000 50,400 $140,400 600,000 $740,400 Long-term note payable $1,125,600 Total liabilities Property, plant, and equipment, net 3,360,000 Intangible assets: Shareholders' Equity Preferred shares, $2.50 cumulative, 24,000 authorized and issued Trademark, net $20,400 $240,000 Organization costs Common shares, 300,000 shares authorized, 200,000 shares issued 18,000 2,500,000 1,043,600 Total intangible assets 38,400 Retained earnings Total shareholders' equity 3,783,600 S4,524,000 Total assets 4,524,000 Total liabilities and shareholders' equity