Comparative Calendar Year Financial Data for a Company Are Shown

question 6

Essay

Comparative calendar year financial data for a company are shown below:
$\begin{array}{|l|r|r|}\hline & \underline { 2014 }& \underline { 2013 }\\\hline \text { Sales } & \$ 720,000 & \$ 607,500 \\\hline \text { Gross profit } & 270,000 & 224,800 \\\hline \text { Income before taxes } & 79,200 & 78,700 \\\hline \text { Net income } & 51,200 & 51,700 \\\hline \\\hline& \text { December 31, } & \text { December 31, } \\\hline &2014 & 2013 \\\hline \text { Liabilities } & \$ 493,500 & \$ 452,500 \\\hline \text { Common stock (\$12 par) } & 180,000 & 180,000 \\\hline \text { Contributed capital in excess of par } & 135,000 & 135,000 \\\hline \text { Retained earnings } & 204,000 & \underline{177,300} \\\hline \text { Total liabilities and equity } & \underline{ \$ 1,012,500} & \underline{\$ 944,800} \\\hline\end{array}$ Calculate:
(1)Return on total assets for 2014.
(2)Return on common stockholders' equity for 2014.

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Definitions:

Financial Buyer

A type of buyer in acquisitions primarily focused on the investment potential and financial returns of the purchase rather than strategic or operational synergies.

Mental Picture

An image or visualization created in the mind that represents ideas, visions, or potential outcomes; often used in planning and creative processes.

Vision

A statement or idea that outlines a company's goals and values, providing direction for future growth and decision-making.

Business

An organization or enterprising entity engaged in commercial, industrial, or professional activities, aiming to generate profits through the provision of goods and services.