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The balance sheet and income statement shown below are for Big D Caf: Balance Sheet (millions of $) Assets Cash and securities 2,500 Accounts receivable

The balance sheet and income statement shown below are for Big D Caf:

Balance Sheet (millions of $)

Assets

Cash and securities 2,500

Accounts receivable 11,500

Inventories 16,000

Total current assets 30,000

Net plant and equipment 20,000

Total assets 50,000

Liabilities and Equity

Accounts payable 9,500

Notes payable 7,000

Accruals 5,500

Total current liabilities 22,000

Long-term debt 15,000

Total liabilities 37,000

Common stock 2,000

Retained earnings 11,000

Total common equity 13,000

Total liabilities and equity 50,000

Income Statement (millions of $)

Sales 87,500

Operating costs except depreciation 81,813

Depreciation 1,531

EBIT 4,156

Interest expense 1,375

EBT 2,781

Taxes 973

Net income 1,808

Other data

Shares outstanding (million) 500

Common dividends $632.73

Interest rate on notes payable and L-T debt 6.25%

Tax rate 35%

Year-end stock price $43.39

Please answer the following questions:

  1. What is the firms quick ratio?
  2. What is the Inventory turnover ratio?
  3. What is the firms days sales outstanding? Assume a 365-day year
  4. What is the firms ROA?
  5. What is the firms total debt to total capital ratio?
  6. What is the firms profit margin?
  7. What is the firms ROE using the DuPont equation?

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