The following information pertains to Dallas Company. Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit.AssetsCash and short-term investments$41,706Accounts receivable (net)32,359Inventory33,536Property, plant, and equipment244,092Total Assets$351,693 Liabilities and Stockholders' EquityCurrent liabilities$67,811Long-term liabilities92,969Common stock, $20 par125,380Retained earnings65,533Total Liabilities and stockholders' equity$351,693 Income StatementSales$85,174Cost of goods sold38,328Gross margin$46,846Operating expenses28,378Net income$18,468 Number of shares of common stock6,269Market price of common stock$20Dividends per share$1.00Cash provided by operations$40,000What is the return on stockholders' equity?a.28.2%b.1.1%c.6.9%d.2.9%

Return on shareholders' equity refers to the proportionate income earned by the shareholders on the…

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Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter16: Financial Statement Analysis

Section: Chapter Questions

Problem 6BE

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The following information pertains to Dallas Company. Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit.

Assets
Cash and short-term investments	$41,706
Accounts receivable (net)	32,359
Inventory	33,536
Property, plant, and equipment	244,092
Total Assets	$351,693


Liabilities and Stockholders' Equity
Current liabilities	$67,811
Long-term liabilities	92,969
Common stock, $20 par	125,380
Retained earnings	65,533
Total Liabilities and stockholders' equity	$351,693

Income Statement
Sales	$85,174
Cost of goods sold	38,328
Gross margin	$46,846
Operating expenses	28,378
Net income	$18,468

Number of shares of common stock	6,269
Market price of common stock	$20
Dividends per share	$1.00
Cash provided by operations	$40,000

What is the return on stockholders' equity?

a.28.2%

b.1.1%

c.6.9%

d.2.9%

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