oblems 4-1 DAYS SALES OUTSTANDING Baxley Brothers has a DSO of 23 days, and its annual sales are $3,650,000. What is its accounts receivable balance? Assume that it uses a 365-day year. DEBT TO CAPITAL RATIO Kaye's Kitchenware has a market/book ratio equal to 1. Its stock price is $12 per share and it has 4.8 million shares outstanding. The firm's total 4-2 Fundamental Concepts in Financial Management 4-3 4-4 capital is $110 million and it finances with only debt and common equity. What is its debt-to-capital ratio? DUPONT ANALYSIS Henderson's Hardware has an ROA of 11%, a 6% profit margin, and an ROE of 23%. What is its total assets turnover? What is its equity multiplier? MARKET/BOOK AND EV/EBITDA RATIOS Edelman Engines has $17 billion in total assets of which cash and equivalents total $100 million. Its balance sheet shows $1.7 billion in current liabilities--of which the notes payable balance totals $1 billion. The firm also has $10.2 billion in long-term debt and $5.1 billion in common equity. It has 300 million shares of common stock outstanding, and its stock price is $20 per share. The firm's EBITDA totals $1.368 billion. 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? PRICE/EARNINGS RATIO A company has an EPS of $2.40, a book value per share of $21.84, and a market/book ratio of 2.7x, What is its P/E ratio? DUPONT AND ROE A firm has a profit margin of 3% and an equity multiplier of 1.9. Its sales are $150 million, and it has total assets of $60 million. What is its ROE? 4-5 4-6