Question
3. Henderson's Hardware has an ROA of 8%, a 3% profit margin, and an ROE of 25%. What is its total assets turnover? Do not
3. Henderson's Hardware has an ROA of 8%, a 3% profit margin, and an ROE of 25%.
What is its total assets turnover? Do not round intermediate calculations. Round your answer to two decimal places.
What is its equity multiplier? Do not round intermediate calculations. Round your answer to two decimal places.
4. Edelman Engines has $20 billion in total assets of which cash and equivalents total $110 million. Its balance sheet shows $4 billion in current liabilities of which the notes payable balance totals $0.93 billion. The firm also has $10 billion in long-term debt and $6 billion in common equity. It has 400 million shares of common stock outstanding, and its stock price is $26 per share. The firm's EBITDA totals $1.56 billion. Assume the firm's debt is priced at par, so the market value of its debt equals its book value. What are Edelman's market/book and its EV/EBITDA ratios? Do not round intermediate calculations. Round your answers to two decimal places.
M/B:
EV/EBITDA:
7. Baker Industries net income is $21,000, its interest expense is $6,000, and its tax rate is 25%. Its notes payable equals $23,000, long-term debt equals $80,000, and common equity equals $250,000. The firm finances with only debt and common equity, so it has no preferred stock. What are the firms ROE and ROIC? Do not round intermediate calculations. Round your answers to two decimal places.
ROE: %
ROIC: %
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