The following information pertains to Ortiz Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit.
| Assets |
| Cash and short-term investments |
$ 45,000 |
| Accounts receivable (net) |
30,000 |
| Inventory |
40,000 |
| Property, plant and equipment |
310,000
|
|
Total Assets |
$425,000
|
|
|
|
| Liabilities and Stockholders' Equity |
| Current liabilities |
$ 55,000 |
| Long-term liabilities |
110,000 |
| Stockholders' equity-common |
260,000
|
|
Total Liabilities and Stockholders' Equity |
$425,000
|
|
|
|
| Income Statement |
| Sales |
$120,000 |
| Cost of goods sold |
65,000 |
| Gross profit |
55,000 |
| Operating expenses |
29,000
|
|
Net income |
$ 25,500
|
|
|
|
| Number of shares of common stock |
6,000 |
| Market price of common stock |
$20 |
| Dividends per share |
.50 |
What is the return on assets for Ortiz?