The Following Selected Data Were Taken from the Financial Statements

question 6

Essay

The following selected data were taken from the financial statements of the Berrol Group for December 31, 2012, 2011, and 2010:
The 2012 net income was $242,000 and the 2011 net income was $308,000. No dividends on common stock were declared between 2010 and 2012.
Required:
(1) Determine the rate earned on total assets, the rate earned on stockholders' equity, and the rate earned on common stockholders' equity for the years 2012 and 2011. Round to one decimal place.
(2) What conclusion can be drawn from these data as to the company's profitability?

---

Definitions:

R Chart

R Chart, or range chart, is a type of control chart used in statistical process control to monitor the variability of a process based on samples taken from the process at given times.

Process Spread

Process spread refers to the variability within a process, often measured to assess the consistency of output over time.

Monitor

To regularly observe or check something over a period of time for the purpose of keeping track of its state or progress.

Compressive Strength

A property of material that measures its ability to withstand loads that tend to reduce size, crucial in evaluating the performance of materials in structure.