Question
use the information about SyncTech, Inc . provided below. SyncTech B/S (in $ thousand): FYE 2055 FYE 2054 Cash & cash equivalents $ 882,210 $
use the information about SyncTech, Inc. provided below.
SyncTech B/S (in $ thousand):
FYE 2055 | FYE 2054 | |
Cash & cash equivalents | $ 882,210 | $ 571,250 |
Receivables | 771,580 | 775,250 |
Inventories | 1,320,150 | 1,254,600 |
Other current assets | 249,000 | 231,200 |
Net property, plant & equipment | 1,118,750 | 1,100,300 |
Intangibles | 263,050 | 241,000 |
Deposits & other long-term assets | 184,500 | 168,250 |
|
| |
Total assets | $4,789,240 | $4,341,850 |
|
| |
Accounts payable | $1,178,540 | $1,061,100 |
Short-term debt | 18,100 | 316,500 |
Accrued expenses | 803,000 | 724,300 |
Long-term debt | 478,250 | 378,400 |
Other long-term liabilities | 13,350 | 0 |
|
| |
Preferred stock | 850,000 | 850,000 |
Common stock | 1,448,000 | 1,011,550 |
|
| |
Total liab. & equity | $4,789,240 | $4,341,850 |
|
|
SyncTech I/S (in $ thousand):
FY 2055 | |
Net sales | 11,455,500 |
Cost of goods sold | (8,026,450) |
Gross profits | 3,429,050 |
Selling, general & admin. exp. | (1,836,400) |
EBITDA | 1,592,650 |
Depreciation & amortization | (785,250) |
Interest expense | (46,195) |
Income before tax | 761,205 |
Income taxes | (157,725) |
Net income | $603,480 |
|
SyncTech additional information:
Number of common shares (weighted average): 308,515 thousand shares
Preferred dividends: $85,000 thousand
Use the information about SyncTech, Inc. provided above to answer the following.
a. Compute the firm's ROCE for FY 2055 (*ignore the adjustment for interest expenses) and decompose it into three components (a.k.a. DuPont analysis).
b. Suppose that the firm's assets were 100% financed through equity (i.e., no liability). What would the difference between ROA and ROCE be?
Step by Step Solution
3.48 Rating (158 Votes )
There are 3 Steps involved in it
Step: 1
a To compute the firms Return on Capital Employed ROCE for FY 2055 well use the DuPont analysis to b...Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started