Exam 3: Analyzing Financial Statements

A firm has a debt ratio of 45 percent,capital intensity ratio is 1.3 times,profit margin is 10 percent,and dividend payout ratio is 30 percent.Calculate the sustainable growth rate for the firm.

If Epic,Inc.has an ROE = 25 percent,equity multiplier = 4,a profit margin of 12 percent,what is the total asset turnover ratio?

DJ's Soda Fountain has asked you to help piece together financial information on the firm for the most current year.Managers give you the following information: sales = $20 million,total debt = $3 million,debt ratio = 75 percent,ROE = 27 percent. Using this information,what is DJ's ROA?

Which of the following is the maximum growth rate that can be achieved by financing asset growth with new debt and retained earnings?

Which ratio measures the operating return on the firm's assets irrespective of financial leverage and taxes?

Which of the following measures the operating return on the firm's assets,irrespective of financial leverage and taxes?

Which type of ratio measures a firm's ability to pay off short-term obligations without relying on inventory sales?

Calculate the times interest earned ratio for Paige's Purses,Inc.using the following information: sales = $50,000,000,cost of goods sold = $15,000,000,depreciation expense = $2,000,000,addition to retained earnings = $10,000,000,dividends per share = $1.10,tax rate = 30 percent,and number of shares of common stock outstanding = 10,000,000.Paige's Purses has no preferred stock outstanding.

Leash N Collar reported a profit margin of 8 percent,total asset turnover ratio of 1.5 times,debt-to-equity ratio of 0.75 times,net income of $400,000,and dividends paid to common stockholders of $200,000.The firm has no preferred stock outstanding.What is Leash N Collar's internal growth rate?

Calculate the times interest earned ratio for Tierre's Ts,Inc.using the following information.Sales = $200,000,cost of goods sold = $50,000,depreciation expense = $13,000,addition to retained earnings = $70,000,dividends per share = $0.50,tax rate = 30 percent,and number of shares of common stock outstanding = 1,000.Tierre's Ts has no preferred stock outstanding.

A firm reported year-end cost of goods sold of $10 million.It listed $2 million of inventory on its balance sheet.Using a 365-day year,how many days did the firm's inventory stay on the premises?

A corporation has a total asset turnover of 2 times,ROA of 12 percent and EM of 1.17.What is this firm's profit margin and debt ratio?

Burt's TVs has current liabilities of $25 million.Cash makes up 40 percent of the current assets and accounts receivable makes up another 20 percent of current assets.Burt's current ratio = 0.85 times.What is the value of inventory listed on the firm's balance sheet?

A firm's year-end price on its common stock is $55.The firm has a profit margin of 6 percent,total assets of $75 million,a total asset turnover ratio of 0.9,no preferred stock,and 2.5 million shares of common stock outstanding.Calculate the PE ratio for the firm.

Which of the following will increase a firm's quick ratio assuming no other accounts change?

Which of the following measures the number of days that the firm holds accounts payable before it has to extend cash to buy raw materials?

Which company has the most risk from an investor's standpoint? Firm A has a PE of 92 times and Firm B has a PE of 16 times.Assume both firms operate in the same industry.Firm A has fewer shares outstanding than Firm B.

You have the following information on Olivia's Bridle Shop: total liabilities and equity = $65 million,current liabilities = $10 million,inventory = $15 million,and quick ratio = 3 times.Using this information,what is the balance for fixed assets on Olivia's balance sheet?

You are thinking of investing in Wave Runnerz,Inc.You have only the following information on the firm at year-end 2013: net income = $10 million,total debt = $65 million,and debt ratio = 35 percent.What is Wave Runnerz's ROE for 2018?

According to the list provided in the textbook,which of the following is NOT one of the cautions in using ratios to evaluate firm performance?