Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Hello i have attached the file below. Please help me with this question and thank you for your time. Ch 3 1 Calculating Profitability Ratios.

Hello i have attached the file below. Please help me with this question and thank you for your time.

image text in transcribed Ch 3 1 Calculating Profitability Ratios. Remi, Inc., has sales of $15 million, total assets of $9 million, and total debt of $3.7 million. a. If the profit margin is 7 percent, what is net income? (__________) b. What is ROA? (__________) c. What is ROE? (__________) 2. Calculating Inventory Turnover. Bobaflex Corporation has ending inventory of $426,163 and cost of goods sold for the year just ended was $6,238,615. a. What is the inventory turnover? (__________) b. The days' sales in inventory? (__________) c. How long on average did a unit of inventory sit on the shelf before it was sold? (__________) 3. Calculating Market Value Ratios. Rossdale, Inc., had additions to retained earnings for the year just ended of $575,000. The firm paid out $140,000 in cash dividends, and it has ending total equity of $7.3 million. a. If the company currently has 490,000 shares of common stock outstanding, what are earnings per share? (__________) b. Dividends per share? (__________) c. What is book value per share? (__________) d. If the stock currently sells for $47 per share, what is the market-to-book ratio? (__________) e. The price-earnings ratio? (__________) f. If total sales were $15.4 million, what is the price-sales ratio? (__________) 4. DuPont Identity. Jiminy Cricket Removal has a profit margin of 8 percent, total asset turnover of 1.24, and ROE of 14.30 percent. What is this firm's debt-equity ratio? (__________) 5. Equity Multiplier and Return on Equity. Rainbow Company has a debt-equity ratio of .95. Return on assets is 7.5 percent, and total equity is $735,000. a. What is the equity multiplier? (__________) b. Return on equity? (__________) c. Net income? (__________) 6. Sustainable Growth. If the Crash Davis Driving School has an ROE of 14.5 percent and a payout ratio of 30 percent, what is its sustainable growth rate? (__________) Page 1 of 2 7. Sustainable Growth. Assuming the following ratios are constant, what is the sustainable growth rate? (__________) 8. Calculating Internal Growth. The most recent financial statements for Shinoda Manufacturing Co. are shown below: Assets and costs are proportional to sales. Debt and equity are not. The company maintains a constant 40 percent dividend payout ratio. No external financing is possible. What is the internal growth rate? (__________) 9. Total Asset Turnover. Kaleb's Karate Supply had a profit margin of 8.5 percent, sales of $16 million, and total assets of $6.8 million. a. What was total asset turnover? (__________) b. If management set a goal of increasing total asset turnover to 2.75 times, what would the new sales figure need to be, assuming no increase in total assets? (__________) 10. Market Value Ratios. Mustaine, Inc., has a current stock price of $54. For the past year, the company had net income of $7,900,000, total equity of $26,300,000, sales of $50,500,000, and 4.1 million shares of stock outstanding. a. What are earnings per share (EPS)? (__________) b. Price-earnings ratio? (__________) c. Price-sales ratio? (__________) d. Book value per share? Market-to-book ratio? (__________) e. Market-to-book ratio? (__________) Page 2 of 2

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Multinational Management

Authors: John B. Cullen

6th edition

1285094946, 1285094948, 9781285696744 , 978-1285094946

Students also viewed these Finance questions