Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please answer e, F, g and h The income statement and balance sheet for ALDA, Inc. are provided below. (Note that the reported figures are

image text in transcribed
image text in transcribed
please answer e, F, g and h
The income statement and balance sheet for ALDA, Inc. are provided below. (Note that the reported figures are expressed in thousands of dollars). ALDA, INC. Balance Sheets as of December 31, 2018 and 2019 (in 000s) 2018 2019 2018 2019 Assets Liabilities and Owners' Equity Current assets Current liabilities Cash $ 250 $ 350 Accounts payable $ 500 $ 900 Accounts receivable 500 490 Notes payable 900 700 Inventory 960 Total $1,500 $1,800 Total $ 1,400 $ 1,600 -45 750 k $ 400 $ 200 Long-term debt Owners' equity Common stock Accumulated retained earnings Fixed assets $ 200 $ 500 235 965 Net plant and equipment $ 1,000 $ 1,200 Total Equity $ 700 $ 1,200 Total assets $2,500 $3,000 Total liabilities and owners' equity $2,500 $ 3,000 ALDA, INC 2019 Income Statement (in 000s) Sales Cost of goods sold Depreciation EBIT $ Interest paid Taxable income $ Taxes 2,500 1,600 50 850 65 785 165 Net income $ 620 nhadondo ALDA, INC. 2019 Income Statement (in 000s) Sales $ Cost of goods sold Depreciation 2,500 1,600 50 $ EBIT Interest paid 850 65 $ Taxable income Taxes 785 165 Net income $ 620 $ 155 Dividends Retained earnings 465 Requirement #1: Calculate each of the following ratios for ALDA Inc. for 2019 only and complete the table below. (Do not round intermediate calculations. Round your answers to 4 decimal places (e.g., 0.9173 or 2.1648). Input profit margin, return on assets, and return on equity as percentages (e.g., if the Profit Margin = 0.1576, input your answer as 15.76). 2019 Industry Average a. Current ratio 11250 times 1.0478 b. Quick ratio 0.5250 times 0.3621 c. Total asset turnover 0.8333 times 0.8117 d. Inventory turnover 2.6042 times 1.5656 e. Total debt ratio 0.5333 times 0.5463 f. Equity Multiplier 2.5000 2.2040 g. Times interest earned ratio 13.0769 times 9.6172 h. Profit margin 38.40% 31.58% i. Return on assets 28.33% 25.63% j. Return on equity 51.67% 56.50% Requirement #2: Use the ratios you calculated in Requirement #1 and the industry averages given in the table above to determine if ALDA, Inc. is "above average" or "below average in each of the following areas of financial performance

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored 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

Financial Management Principles And Practices

Authors: Timothy J. Gallagher

9th Edition

1954156103, 978-1954156104

More Books

Students also viewed these Finance questions