The Following Amounts Were Taken from the Financial Statements of Ando

question 110

Multiple Choice

The following amounts were taken from the financial statements of Ando Company: $\begin{array}{lrr}&2014&2013\\\text { Total assets } & \$ 800,000 & \$ 1,000,000 \\\text { Net sales } & 720,000 & 650,000 \\\text { Gross profit } & 352,000 & 320,000 \\\text { Net income } & 126,000 & 11,000 \\\text { Weighted average number of } & &\\\text { common shares outstanding }&90,000 & 90,000 \\\text { Market price of common stock }&\$ 35 & \$ 39\end{array}$ The return on assets for 2014 is

• A) 16%.
• B) 14%.
• C) 32%.
• D) 28%.

---

Definitions:

Asset Turnover

An efficiency ratio that gauges a company's capability to use its assets for producing sales earnings.

Additions to Land

Expenditures made to increase the value of land, which can include costs for landscaping, site improvement, or acquiring adjacent land.

Parking Lots

Designated areas where vehicles can be parked temporarily. These can be commercial ventures or part of public infrastructure.

Fences

Structures erected to enclose or delineate areas, or to prevent unauthorized access or egress.