50.1K

Verified Solution

Link Copied!

Financial data for Bridger, Inc., for last year are as follows:

Bridger, Inc. Balance Sheet
	Beginning Balance		Ending Balance
Assets
Cash	$	130,000	$	133,000
Accounts receivable		349,000		483,000
Inventory		575,000		490,000
Plant and equipment, net		836,000		824,000
Investment in Brier Company		392,000		428,000
Land (undeveloped)		245,000		247,000
Total assets	$	2,527,000	$	2,605,000
Liabilities and Stockholders' Equity
Accounts payable	$	378,000	$	333,000
Long-term debt		1,044,000		1,044,000
Stockholders' equity		1,105,000		1,228,000
Total liabilities and stockholders' equity	$	2,527,000	$	2,605,000

Bridger, Inc. Income Statement
Sales		$	5,348,000
Operating expenses			4,599,280
Net operating income			748,720
Interest and taxes:
Interest expense	$ 120,000
Tax expense	193,000		313,000
Net income		$	435,720

The company paid dividends of $312,720 last year. The Investment in Brier Company on the balance sheet represents an investment in the stock of another company.

Required:
1.	Compute the companys margin, turnover, and return on investment (ROI) for last year. (Do not round intermediate calculations. Round your final answers to 2 decimal places. Omit the "%" sign in your response.)

Margin	%
Turnover
ROI	%

2.	The board of directors of Bridger, Inc., has set a minimum required return of 15%. What was the companys residual income last year? (Omit the "$" sign in your response.)

Residual income

$

Answer & Explanation Solved by verified expert

See Answer