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Financial data for Joel de Paris, Inc
Financial data for Joel de Paris, Inc., for last year follow:
Joel de Paris, Inc.
Balance Sheet
Beginning
Balance
Ending
Balance
Assets
Cash
$
128,000
$
137,000
Accounts receivable
335,000
481,000
Inventory
562,000
479,000
Plant and equipment, net
825,000
793,000
Investment in Buisson, S.A.
393,000
431,000
Land (undeveloped)
246,000
254,000
Total assets
$
2,489,000
$
2,575,000
Liabilities and Stockholders' Equity
Accounts payable
$
379,000
$
347,000
Long-term debt
958,000
958,000
Stockholders' equity
1,152,000
1,270,000
Total liabilities and stockholders' equity
$
2,489,000
$
2,575,000
Joel de Paris, Inc.
Income Statement
Sales
$
4,301,000
Operating expenses
3,612,840
Net operating income
688,160
Interest and taxes:
Interest expense
$
120,000
Tax expense
203,000
323,000
Net income
$
365,160
The company paid dividends of $247,160 last year. The "Investment in Buisson, S.A.," on the balance sheet represents an investment in the stock of another company. The company's minimum required rate of return of 15%.
Required:
1. Compute the company's average operating assets for last year.
2. Compute the company's margin, turnover, and return on investment (ROI) for last year. (Round "Margin", "Turnover" and "ROI" to 2 decimal places.)
3. What was the company's residual income last year?
Expert Solution
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