Use This Information for Kellman Company to Answer the Questions $\text { Kellman Company }$

question 152

Multiple Choice

Use this information for Kellman Company to answer the questions that follow.
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The balance sheets at the end of each of the first two years of operations indicate the following:
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$\text { Kellman Company }$
$\begin{array}{lrr}&\text { Year } 2&\text { Year } 1\\\text { Total current assets } & \$ 600,000 & \$ 560,000 \\\text { Total investments } & 60,000 & 40,000 \\\text { Total property, plant, and equipment } & 900,000 & 700,000 \\\text { Total current liabilities } & 125,000 & 65,000 \\\text { Total long-term liabilities } & 350,000 & 250,000 \\\text { Preferred } 9 \% \text { stock, } \$ 100 \text { par } & 100,000 & 100,000 \\\text { Common stock, } \$ 10 \text { par } & 600,000 & 600,000 \\\text { Paid-in capital in excess of par-Common stock } & 75,000 & 75,000 \\\text { Retained earnings } & 310,000 & 210,000\end{array}$
-Using the balance sheets for Kellman Company, if net income is $150,000 and interest expense is $20,000 for Year 2, what is the return on total assets for the year?

• A) 10.4%
• B) 11.9%
• C) 10.5%
• D) 8.4%

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Definitions:

Modalities

Refers to the various methods, forms, or procedures available for accomplishing a task or function, often used in contexts such as transportation, therapy, and communication.

Responsive Transportation

Transportation methods that are flexible and adaptable to quickly respond to changing supply chain needs.

Sourcing Decision

The process of determining where and how a company will procure the necessary goods or services to conduct its business.

Traditional Inventory

A conventional method of inventory management where stocks are maintained to meet demand without considering just-in-time strategies.