The Following Amounts Were Taken from the Financial Statements of Ando

question 40

Multiple Choice

The following amounts were taken from the financial statements of Ando Company: $\begin{array}{lrr}&2017&2016\\\text { Total assets } & \$ 800,000 & \$ 1,000,000 \\\text { Net sales } & 720,000 & 650,000 \\\text { Gross profit } & 352,000 & 320,000 \\\text { Net income } & 108,000 & 117,000 \\\text { Weighted average number of } & & \\\quad \text { common shares outstanding } & 90,000 & 90,000 \\\text { Market price of common stock } & \$ 42 & \$ 39\end{array}$ The return on assets for 2017 is

• A) 14%.
• B) 12%.
• C) 11%.
• D) 6%.

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Definitions:

Treble Damages

A form of punitive damages awarded in a legal case that are three times the amount of actual compensatory damages.

Civil Actions

Legal proceedings initiated by individuals or entities (aside from the state) to seek relief or damages from another party.

Sherman Act

A foundational antitrust law in the United States aimed at promoting competition and restricting monopolistic practices.

Price Fixing

An illegal agreement among competitors to control prices, usually aimed at increasing prices or reducing competition in the market.