Question

Fnancial data for Joel de Paris, Inc., for last year follow:

Joel de Paris, Inc. Balance Sheet
	Beginning Balance			Ending Balance
Assets
Cash	$	131,000		$	130,000
Accounts receivable		349,000			478,000
Inventory		570,000			471,000
Plant and equipment, net		780,000			791,000
Investment in Buisson, S.A.		404,000			435,000
Land (undeveloped)		254,000			251,000
Total assets	$	2,488,000		$	2,556,000
Liabilities and Stockholders' Equity
Accounts payable	$	376,000		$	333,000
Long-term debt		1,038,000			1,038,000
Stockholders' equity		1,074,000			1,185,000
Total liabilities and stockholders' equity	$	2,488,000		$	2,556,000

Joel de Paris, Inc. Income Statement
Sales					$	4,070,000
Operating expenses						3,418,800
Net operating income						651,200
Interest and taxes:
Interest expense	$	125,000
Tax expense		204,000				329,000
Net income					$	322,200

The company paid dividends of $211,200 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?

1.	Average Operating Assets	$
2.	Margin		%
	Turnover
	ROI		%
3.	Residual Income

Answer 1