Question
21) Given the financial statements for Jones Corporation and Smith Corporation:
JONES CORPORATIONCurrent AssetsLiabilities Cash $126,600 Accounts payable$156,000 Accounts receivable 188,500 Bonds payable (long term) 81,100 Inventory 59,200 Long-Term Assets Stockholders’ Equity Gross fixed assets$525,000 Common stock$150,000 Less: Accumulated depreciation 154,100 Paid-in capital 70,000 Net fixed assets* 370,900 Retained earnings 288,100 Total assets $745,200 Total liabilities and equity$745,200 Sales (on credit)$1,758,000 Cost of goods sold 727,000 Gross profit$1,031,000 Selling and administrative expense† 321,000 Depreciation expense 55,300 Operating profit$654,700 Interest expense 12,400 Earnings before taxes$642,300 Tax expense 96,700 Net income$545,600 *Use net fixed assets in computing fixed asset turnover.†Includes $8,000 in lease payments. SMITH CORPORATIONCurrent AssetsLiabilities Cash $43,100 Accounts payable$76,100 Marketable securities 14,700 Bonds payable (long term) 303,000 Accounts receivable 75,300 Inventory 84,200 Long-Term AssetsStockholders’ Equity Gross fixed assets$587,000 Common stock$75,000 Less: Accumulated depreciation 252,800 Paid-in capital 30,000 Net fixed assets* 334,200 Retained earnings 67,400 Total assets $551,500 Total liabilities and equity$551,500 *Use net fixed assets in computing fixed asset turnover. SMITH CORPORATION Sales (on credit)$1,540,000 Cost of goods sold 1,129,000 Gross profit$411,000 Selling and administrative expense† 233,000 Depreciation expense 52,000 Operating profit$126,000 Interest expense 25,400 Earnings before taxes$100,600 Tax expense 60,400 Net income$40,200 †Includes $8,000 in lease payments. a.Compute the following ratios. (Use a 360-day year. Do not round intermediate calculations. Input your profit margin, return on assets, return on equity, and debt to total assets answers as a percent rounded to 2 decimal places. Round all other answers to 2 decimal places.)
Jones Corp.Smith Corp. Profit margin % % Return on assets (investments) % % Return on equity % % Receivable turnover times times Average collection period days days Inventory turnover times times Fixed asset turnover times times Total asset turnover times times Current ratio times times Quick ratio times times Debt to total assets % % Times interest earned times times Fixed charge coverage times times
Looking for a Similar Assignment? Order now and Get 10% Discount! Use Coupon Code "Newclient"
Question
16)Using the income statement for Times Mirror and Glass Co., compute the following ratios:
TIMES MIRROR AND GLASS Co.
Income Statement Sales$270,000 Cost of goods sold 130,000 Gross profit$140,000 Selling and administrative expense 43,200 Lease expense 11,700 Operating profit*$85,100 Interest expense 9,300 Earnings before taxes$75,800 Taxes (30%) 30,320 Earnings after taxes$45,480 *Equals income before interest and taxes.
a.Compute the interest coverage ratio. (Round your answer to 2 decimal places.)
Interest coverage times
b.Compute the fixed charge coverage ratio. (Round your answer to 2 decimal places.)
Fixed charge coverage times The total assets for this company equal $205,000. Set up the equation for the Du Pont system of ratio analysis.
c.Compute the profit margin ratio. (Input your answer as a percent rounded to 2 decimal places.) Profit margin %
d.Compute the total asset turnover ratio. (Round your answer to 2 decimal places.) Total asset turnover times
e.Compute the return on assets (investment). (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.)
Return on assets%
Looking for a Similar Assignment? Order now and Get 10% Discount! Use Coupon Code "Newclient"
Question
12)Using the Du Pont method, evaluate the effects of the following relationships for the Butters Corporation.
a.Butters Corporation has a profit margin of 6 percent and its return on assets (investment) is 14 percent. What is its assets turnover? (Round your answer to 2 decimal places.)
Assets turnover ratio times
b.If the Butters Corporation has a debt-to-total-assets ratio of 50.00 percent, what would the firm’s return on equity be? (Input your answer as a percent rounded to 2 decimal places.)
Return on equity % c.What would happen to return on equity if the debt-to-total-assets ratio decreased to 45.00 percent?(Input your answer as a percent rounded to 2 decimal places.)
Return on equity%
Looking for a Similar Assignment? Order now and Get 10% Discount! Use Coupon Code "Newclient"
Question
8)The Hartnett Corporation manufactures baseball bats with Pudge Rodriguez’s autograph stamped on them. Each bat sells for $55 and has a variable cost of $29. There are $40,820 in fixed costs involved in the production process. a.Compute the break-even point in units.
Break-even point units
b.Find the sales (in units) needed to earn a profit of $23,920. Sales quantity neededunits
Looking for a Similar Assignment? Order now and Get 10% Discount! Use Coupon Code "Newclient"
