[Course: Financial Management]

Part1

The following data apply to Jacobus and Associates (millions of dollars):

Cash and marketable securities: $100.00

Fixed assets:$ 283.50

Sales:$ 1,000.00

Net income:$ 50.00

Quick ratio: 2.0

Current ratio: 3.0

DSO: 40.55 days

ROE: 12%

Jacobus has no preferred stock and S-T investment - only common equity, current liabilities, and long-term debt.

Find

(1) Accounts Receivable,

(2) Current Liabilities,

(3) Current Assets,

(4) Total Assets,

(5) LONG,

(6) Common Equity

(7) Long-term debt.

Part2

The Manor Corporation has $500,000 of debt outstanding, and it pays an interest rate of 10% annually: Manor's annual sales are $2 million, its average tax rate is 30%, and its net profit margin on sales is 5%. If the company does not maintain a TIE ratio of at least 5 to 1, then its bank will refuse to renew the loan and bankruptcy will result.

(1) Find Manor's TIE ration

(2) Fill in the Manor's income statement:

EBIT

Interest

EBT

Tax

Net Income

Ps. Give explanation and step by step please