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%  

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