You have been asked to evaluate the historical performance of the company over the last five years. Selected industry ratios have remained relatively steady at the following levels for the last five years: Industry Ratios Return on total assets 18.9 % Return on stockholders’ equity 39.2 % Times interest earned 4.6 Instructions: Calculate three ratios for Year 1 through Year 5. Round to one decimal place.
You have been asked to evaluate the historical performance of the company over the last five years. Selected industry ratios have remained relatively steady at the following levels for the last five years: Industry Ratios Return on total assets 18.9 % Return on stockholders’ equity 39.2 % Times interest earned 4.6 Instructions: Calculate three ratios for Year 1 through Year 5. Round to one decimal place.
Chapter2: Analysis Of Financial Statements
Section: Chapter Questions
Problem 16PROB
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Question
Critelli Company has provided the following comparative information:
| Year 5 | Year 4 | Year 3 | Year 2 | Year 1 | ||||||
| Net income | $1,327,400 | $1,144,300 | $961,600 | $821,900 | $696,500 | |||||
| Interest expense | 451,300 | 411,900 | 355,800 | 271,200 | 215,900 | |||||
| Income tax expense | 424,768 | 320,404 | 269,248 | 213,694 | 167,160 | |||||
| Average total assets | 9,264,063 | 8,190,526 | 7,007,447 | 5,973,224 | 5,097,207 | |||||
| Average |
3,130,660 | 2,818,473 | 2,478,351 | 2,209,409 | 1,945,531 |
You have been asked to evaluate the historical performance of the company over the last five years.
Selected industry ratios have remained relatively steady at the following levels for the last five years:
| Industry Ratios | ||
| Return on total assets | 18.9 % | |
| Return on stockholders’ equity | 39.2 % | |
| Times interest earned | 4.6 |
Instructions:
Calculate three ratios for Year 1 through Year 5. Round to one decimal place.
Transcribed Image Text:a. Return on total assets:
Year 5
%
Year 4
%
Year 3
%
Year 2
%
Year 1
%
b. Return on stockholders' equity:
Year 5
%
Year 4
%
Year 3
%
Year 2
%
Year 1
%
c. Times interest earned:
Year 5
Year 4
Year 3
Year 2
Year 1
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