Comparative Calendar Year Financial Data for a Company Are Shown

question 101

Essay

Comparative calendar year financial data for a company are shown below:
$\begin{array}{|l|r|r|}\hline&2014&2013\\\hline \text { Sales } & \$ 720,000 & \$ 607,500 \\\hline \text { Gross profit } & 270,000 & 224,800 \\\hline \text { Income before taxes } & 79,200 & 78,700 \\\hline \text { Net income } & 51,200 & 51,700\\\hline\\\hline&\text { December } 31&\text { December } 31\\\hline&2014&2013\\\hline\text { Liabilities } & \$ 493,500 & \$ 452,500 \\\hline \text { Common stock ( } \$ 12 \text { par) } & 180,000 & 180,000 \\\hline \text { Contributed capital in excess of par } & 135,000 & 135,000 \\\hline \text { Retained earnings } & 204,000 & 177,300 \\\hline \text { Total liabilities and equity } & \$ 1.012,500 & \$ 944,800 \\\hline \end{array}$

Calculate:
(1)Return on total assets for 2014.
(2)Return on common stockholders' equity for 2014.

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Definitions:

Journal

A detailed record of all financial transactions, used as the primary source for all accounting entries.

Ledger

A comprehensive collection of a company's financial accounts, transactions, and balances over a period.

Structured Format

A specified and organized way of presenting or arranging information or data, typically following a predefined layout.

T-account

A graphical representation of a ledger account that is used for educating and understanding accounting.