Answer:
a.) Income Statement for the year
Revenue
Operating Revenue Net sales $4,395,253
Less: Expenses
Cost of goods sold ($2,821,455)
Operating expenses ($1,004,396) ($3,825,851)
Earnings before Interest and Taxes $569,402
Add: Other Income Interest revenue $15,797
Earnings before Taxes $585,199
Less: Taxes ($204,820)
Net earnings $380,379
Earnings per share $1.70
Number of shares = $380,379/$1.70 = 223,752 shares
b.) 1 Gross profit rate
= gross profit/Net sales
Gross profit = Net sales - Cost of goods sold = $4,395,253 - $2,821,555 = $1,573,698
Rate = $1,573,698/ $4,395,253 = 35.8045%
b.) 2 Net income as a percentage of net sales = ($380,379/$4,395,253) X 100 = 8.654%
b.) 3 Return on assets = (Net income/Average assets) X 100 = ($380,379/$2,575,000) X 100 = 14.772%
b.) 4. Return on equity for the year = (Net income/Average equity) X 100 = ($380,379/$1,917,000) X 100 = 19.8424%
