Question: Utilizing the following information, compute the firm's return on equity.
Balance Sheet (000)
Current Assets 1,500 Current Liabilities 910
Fixed Assets 7,000 Long term Liabilties 1200
Common Stock(at par) 2000
Paid in capital 1000
Retained Earnings 3390
8500 8500
Income Statement (000s)
Net sales 12750
Cost of Sales 7650
Gross Margin 5100
Operating Expenses 3165
Earnings before interest and taxes 1935
Interest 235
Earnings before tax 1700
Taxes (40%) 680
Earnings after tax 1020