Class:Financial Management

1Problem 3.3 Using the DuPont Identity

Y3K, Inc. has sales of $6,199, total assets of $2,815, and a debt - equity ration of 1.2.If its return on equity is 12 percent what is its net income?

Net income =

2 Problem 3.11 Return on Equity

Firm A and Firm B have debt /total asset rations of 31percent and 21 percent and returns on total assets of 7 percent t and 13 percent respectively.

What is the return on equity for Firm A and B?

Return on equity Firm A %Firm B %

3Problem 3-12 Ratios and Foreign Companies

Prince Albert Canning PLC had a net loss of $47,231 on sales of $199,752.What was the company's profit margin?

Profit margin %

In dollars, sales were $317,193.What was the net loss in dollars?

Net loss $

4Problem 3.14 Days' Sales in Receivables

A company has net income of $191,000, a profit margin of 9.4 percent, and an accounts receivable balance of $130,370.Assuming 70 percent of sales are on credit, what is the company's days' sales in receivables?

Days' sales in receivablesday

5Problem 3-15 Ratios and Fixed Assets

The Ark ham Company has a ratio of long-term debt to long-term debt plus equity of 0. 25 and a current ratio of 15.Current liabilities are $900, sales are $6,230, profit margin is 8.1 percent, and ROE is 18.6 percent.What is the amount of the firm's net fixed assets?

Net fixed assets$

6Problem 3-16 Calculating the Cash Coverage Ratio

PVA Inc.'s net income for the most recent year was $15,685. The tax rate was 35 percent.The firm paid $3,856 in total interest expense and deducted $2,535 in depreciation expense.What was the cash coverage ratio for the year?

Cash coverage ratio =

times

7Problem 3-17 Cost of Goods Sold

Sexton Corp. has current liabilities of $450,000, a quick ratio of 0.89, inventory turnover of 6.5, and a current ratio of 1.7.What is the cost of goods sold for the company?

Cost of goods sold$

8Problem 3-18 Common-Size and Common-Base-Year Financial Statements

In addition to common-size financial statements, common-base-year financial statements are often used. Common-base year financial statements are constructed by dividing the current-year value by base-year account value.Thus, the result shows the growth rate in the account.

Prepare the common-size balance sheet and common-base-year balance sheet for the company.Use 2016 as the base-year.

9Problem 3-2 Equity Multiplier and Return on Equity

Quinn Company has a debt-equity ratio 6 Return on assets is 7.1 percent, and total equity is $500,000.

What is the equity multiplier?

Equity multiplier

What is the return on equity?

Return on equity%

What is the net income?

Net income$