The following selected data are taken from the financial statements of Evergreen Company:
Required
1. Compute the following ratios for Evergreen Company:
a. Return on sales
b. Asset turnover (Assume that total assets at the beginning of the year were $1,600,000.)
c. Return on assets
d. Return on common stockholders’ equity (Assume that the only changes in stockholders’equity during the year were from the net income for the year and dividends on the pre-ferred stock.)
2. Comment on Evergreen’s use of leverage. Has it successfully employed leverage? Explain
