19. Victoria Enterprises has $1.6 million of accounts receivable on its balance sheet. The company's DSO is 40 (based on a 360-day year). Its current assets are $2.5 million, and its current ratio 1.5. The company plans to reduce its so from 40 to the industry average of 30 without causing a decline in sales. The resulting decrease in accounts receivable will tree up cash that will be used to reduce current liabilities. If the company succeeds in its plan, what wil Victoria's new current ratio be a. 1.50 b. 1.97 c. 0.72 d. 1.66 20.Ehrenburg Co. had net income of $5.3 million and earnings per share of common stock of $2.50. Included in the net income was $500,000 of bond interest expense related to its long-term debt. The income tax rate was 50%. Dividends on preferred stock were $300,000. The dividend payout ratio on common stock was 40%. What were the dividends on common stock? a. $1,800,000 b. $1,900,000 c. $2,000,000 d. $2,120,000 21. Taft Technologies has the following relationships: Annual sales $1,200,000 Inventory turnover ratio 4.8 Current liabilities $ 375,000 Current ratio 1.2 Days sales outstanding 40 (360-day year) (DSO) The company's current assets consist of cash, inventories, and accounts receivable. How much cash does Taft have on its balance sheet? a. $ 8,333 b. $ 66,667 c. $125,000 d. $200,000 22. JC Goods, Inc. has a total assets turnover of 0.30 and a profit margin of 10%. The president is unhappy with the current return on assets, and he thinks it could be doubled. This could be accomplished (1) by increasing the profit margin to 15% and (2) by increasing total assets turnover. What new asset turnover ratio, along with the 15% profit margin, is required to double the return on assets? a. 35% b. 45% C. 40% d. 50% 23. Rainier Inc. has $2 million in current assets, its current ratio is 1.6, and its quick ratio is 12. The company plans to raise funds as additional notes payable and to use these tunds to increase inventory. By how much con Rainier's short-term debt notes payable) increase without pushing its quick ratio below 0.88 a. $625,000 b. $556,000 c. $333,000 d. $278,000 24.Shepherd Enterprises has an ROE of 15 percent, a debt ratio of 40 percent, and a profit margin of 5 percent. The company's total assets equal $800 million. What are the company's sales? (Assume that the company has no preferred stock.) a. $1,440,000,000 b. $2,400,000,000 C. $ 360,000,000 d. $ 960,000,000