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Financial data for Snape Company for last year appears below: Snape Company Statements of...

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Accounting

Financial data for Snape Company for last year appears below:
Snape Company
Statements of Financial Position
Beginning Balance Ending Balance
Assets:
Cash $58,000 $78,000
Accounts receivable 28,00027,000
Inventory 36,00040,000
Plant and equipment (net)123,000113,000
Investment in Potter Company 82,000102,000
Land (underdeveloped)170,000170,000
Total assets $497,000 $530,000
Liabilities and owners' equity:
Accounts payable $57,000 $70,000
Long-term debt 270,000270,000
Owners' equity 170,000190,000
Total liabilities and owners' equity $497,000 $530,000
Snape Company
Income Statement
Sales $413,000
Less operating expenses 352,000
Net operating income 61,000
Less interest and taxes:
Interest expense $30,000
Tax expense 13,00043,000
Operating Income $18,000
The company paid dividends of $2,000 last year. The "Investment in Potter Company" on the statement of financial position represents an investment in the stock of another company.
Required:
1. Compute the company's margin, turnover, and return on investment for last year.
2. The Board of Directors of Snape Company have set a minimum required return of 20%. What was the company's residual income last year?

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