Data for Lozano Chip Company and its industry averages follow. a. Calculate the indicated ratios for Lozano.

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Data for Lozano Chip Company and its industry averages follow.

a. Calculate the indicated ratios for Lozano.

b. Construct the extended DuPont equation for both Lozano and the industry.

c. Outline Lozano?s strengths and weaknesses as revealed by your analysis.

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Lozano Chip Company: Income Statement for Year Ended December 31, 2019(Thousands of Dollars)Sales ................................................................................................. ?$7,500,000Cost of goods sold ............................................................................. 6,375,000Selling, general, and administrative expenses .................................. 933,000Earnings before interest and taxes (EBIT) ...................................... $ 192,000Interest expense .................................................................................... ?40,000Earnings before taxes (EBT) ............................................................. $ 152,000Federal and state income taxes (25%) ................................................? 38,000Net income .......................................................................................? $ 114,000

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Corporate Finance A Focused Approach

ISBN: 978-1337909747

7th edition

Authors: Michael C. Ehrhardt, Eugene F. Brigham

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