47

Assume a company provided the following balance sheet:

Current assets:				Current liabilities:
Cash	$	50,000		Accounts payable	$	90,000
Accounts receivable		50,000		Accrued liabilities		40,000
Inventory		150,000		Total current liabilities		130,000
Total current assets		250,000		Bonds payable		110,000
Property, plant & equipment, net		380,000		Total liabilities		240,000
				Stockholders equity:
				Common stock		170,000
				Retained earnings		220,000
				Total stockholders equity		390,000
Total assets	$	630,000		Total liabilities and stockholders equity	$	630,000

The debt-to-equity ratio is closest to:

Multiple Choice

• 0.35.

• 0.62.

• 0.78.

• 1.43.

46

Assume a company provided the following information:

Net income	$	60,000
Number of common shares outstanding, beginning of the year		45,000
Number of common shares outstanding, end of the year		55,000
Market price per share	$	12.75
Dividends per share	$	0.50
Total assets, end of the year	$	200,000
Total liabilities, end of the year	$	80,000

The dividend yield ratio is closest to:

Multiple Choice

• 41.7%.

• 3.9%.

• 7.3%.

• 6.0%.

45

Assume a company provided the following information:

Earnings per share	$	2.20
Number of common shares outstanding, beginning of the year		45,000
Number of common shares outstanding, end of the year		55,000
Price-earnings ratio		12.50
Dividend yield ratio		0.50

The market price per share of common stock is closest to:

Multiple Choice

• $27.50.

• $26.50.

• $22.92.

• $24.92.

44

Assume a company provided the following information:

Gross margin percentage		40	%
Sales	$	435,000
Inventory balance, beginning of the year	$	20,000
Inventory balance, end of the year	$	30,000
Net income	$	10,000

The inventory turnover is closest to:

Garrison 17e Rechecks 2020-10-09

Multiple Choice

• 16.

• 13.

• 10.

• 9.