Question

Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance Ending Balance Assets Cash $ 129,000 $ 137,000 Accounts receivable 347,000 488,000 Inventory 564,000 488,000 Plant and equipment, net 790,000 757,000 Investment in Buisson, S.A. 396,000 432,000 Land (undeveloped) 248,000 246,000 Total assets $ 2,474,000 $ 2,548,000 Liabilities and Stockholders' Equity Accounts payable $ 371,000 $ 346,000 Long-term debt 961,000 961,000 Stockholders' equity 1,142,000 1,241,000 Total liabilities and stockholders' equity $ 2,474,000 $ 2,548,000 Joel de Paris, Inc. Income Statement Sales $ 4,440,000 Operating expenses 3,907,200 Net operating income 532,800 Interest and taxes: Interest expense $ 124,000 Tax expense 192,000 316,000 Net income $ 216,800 The company paid dividends of $117,800 last year. The “Investment in Buisson, S.A.,” on the balance sheet represents an investment in the stock of another company. The company's minimum required rate of return of 15%. Required: 1. Compute the company's average operating assets for last year. 2. Compute the company’s margin, turnover, and return on investment (ROI) for last year. (Round "Margin", "Turnover" and "ROI" to 2 decimal places.) 3. What was the company’s residual income last year?

Answer 1