Determine the return on shareholders equity

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Question: Comparative balance sheets for Softech Canvas Goods for 2011 and 2010 are shown below. Softech pays no dividends, and instead reinvests all earnings for future growth.

Comparative Balance Sheets ($ in 000s)


December 31


2011

2010

  Assets:



      Cash

$ 50

$40

      Accounts receivable

100

120

      Short-term investments

50

40

      Inventory

200

140

      Property, plant, and equipment (net)

600

550


$1,000

$890

  Liabilities and Shareholders' Equity:



      Current liabilities

$240

$210

      Bonds payable

160

160

      Paid-in capital

400

400

      Retained earnings

200

120


$1,000

$890

Required: Determine the return on shareholders' equity for 2011.

Reference no: EM131787752

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