Question
17.7A- Perform a Du Pont analysis on the Heart Hospital. Assume that the industry average ration are as follows: Total margin15.0% Total asset turnover1.5 Equity
17.7A- Perform a Du Pont analysis on the Heart Hospital. Assume that the industry average ration are as follows:
Total margin15.0%
Total asset turnover1.5
Equity multiplier1.67
Return of Equity37.6%
17.7B-Calculate and interpret the following ratios for the Heart Hospital
Industry Average
Return of assets22.5%
Current ratio2.0
Days of cash on hand85 days
Average collection period20 days
Debt ratio40%
Debt-to-equity ratio0.67
Times interest earned5.0
Fixed asset turnover ratio1.4
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Financial Markets And Institutions
Authors: Frederic S. Mishkin, Stanley G. Eakins
9th Edition
0134519264, 9780134519265
