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17. XYZ Co. has P/E ratio equal to 7, the closing price was $84. The retained earnings ratio is 25%. Net income is $12,000,000, Capital
17. XYZ Co. has P/E ratio equal to 7, the closing price was $84. The retained earnings ratio is 25%. Net income is $12,000,000, Capital is $18,000,000, The number of stocks is 1,000,000. Calculate the expected return for XYZ Co. common stock and evaluate the investor buying decision for this common stock if the required rate of return is 13%? 18. If the present value of future cash flows at discount rate 12% for project (A) is $20,557 this project has regular cash flows, the life time for the project is 6 years and the initial cost is $20,000. Calculate the IRR for this project. 19. Farrag Co. has net income margin of 15%, total assets turnover of 1.2 times, fixed assets turnover of 4 times, and cash of $50,000. Calculate ROI for Farrag Co. and evaluate the profitability position of the company if the Industry average ROI is 15%. 20. Omar Co. has total assets of $200,000., fixed assets of $140,000 and sales of $600,000. If you know that the credit sales are 40% of sales. Evaluate Omar Co. performance in managing its assets, if industry averages for total assets turnover, fixed assets turnover, and current assets turnover are 2, 3, 11 turns respectively
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