Calculating return on average equity

Assignment Help Operation Management

Reference no: EM13100234

Given the following Year 12 Financial Statement data for a footwear company:

Income Statement Data			Year 12 (in 000s)
Net Revenues from Footwear Sales			$ 340,000
Operating Profit (Loss)			80,000
Net Profit (Loss)			$ 49,000

Balance Sheet Data
Cash on Hand			3,000
Total Current Assets			$ 70,000
Total Assets			310,000
Overdraft Loan Payable			1,000
1-Year Bank Loan Payable			16,000
Current Portion of Long-term Loans			10,000
Total Current Liabilities			51,000
Long-Term Bank Loans Outstanding			70,000
Shareholder Equity:	Year 11 Balance	Year 12 Change
Common Stock	10,000	0	10,000
Additional Capital	120,000	0	120,000
Retained Earnings	30,000	29,000	59,000
Total Shareholder Equity	160,000	+29,000	189,000

Based on the above figures and the formula for calculating return on average equity found on p. 30 of the Player's Guide, the company's Return on Average Equity (the definition of ROE used in scoring company performance) in Year 12
		14.0%.
		28.1%.
		42.3%.
		None of these.
		25.9%.

Reference no: EM13100234

Questions Cloud

Estimating the average annual compensation of production : If a company pays a production worker a base wage of $22,000 and a piecework incentive of $1 per pair, if a production worker's annual productivity is 5,000 pairs per year.

Show knowledge of argument essay and logical fallacies : Show knowledge of "argument" essay and logical fallacies in commercial, social, cultural, and historical perspectives in context of oral, written, and visual rhetoric's.

State a hypothesis-higher levels of cotinine : The data results are based on serum continine levels for each group. The claim is that exposure to tobacco smoke (as second-hand smoke) corresponds to higher levels of cotinine.

Strategic management based question : As is explained on both the Help screens for the Branded Sales Report and the Private-Label Sales Report, when exchange rate shifts result in a weaker US$ and a stronger Singapore $,

Calculating return on average equity : Given the following Year 12 Financial Statement data for a footwear company, Based on the above figures and the formula for calculating return on average equity found on p. 30 of the Player's Guide.

Test with a population mean : On a test with a population mean of 75 and standard deviation equal to 16, if the scores are normally distributed, what percentage of scores fall below a score of 83.8?

Determining binomial random variable : Mike works in a quality at a well known saw blade company. An inpsector on his team has uncovered an issue with the kerf dimension on the bandsaw blade line.

Interior of plastic used for automobiles : Flaws occur in the interior of plastic used for automobiles according to a Poisson distribution with a mean of 0.02 flaws per panel. If 50 panels are inspected, what is the probability that the number of panels that have one or more flaws is less ..

Write research paper mass communications : Choose the mass communications topic of your choice. Write down 5 page research paper on topic and create a 5 minute presentation on same topic.

User Account

All Pages