Finance #3

Muro Press has net working capital of $2,715, net fixed assets of $22,407, sales of $31,350, and current liabilities of $3,908. How many dollars' worth of sales are generated from every $1 in total assets?

$1.08

Cain's has a debt-equity ratio of .94. Return on assets is 8.5 percent, and total equity is $520,000. What is the net income?

$85,748

Custom Framing has a net profit margin of 5.6 percent, a return on assets of 12.5 percent, and an equity multiplier of 1.49. What is the return on equity?

18.63%

Dandelion Fields has a Tobin's Q of .96. The replacement cost of the firm's assets is $225,000 and the market value of the firm's debt is $101,000. The firm has 20,000 shares of stock outstanding and a book value per share of $2.09. What is the market-to-book ratio?

2.75 times

Lawn Care, Incorporated, has sales of $367,400, costs of $183,600, depreciation of $48,600, interest of $39,200, and a tax rate of 21 percent. The firm has total assets of $328,700, long-term debt of $62,400, and current liabilities of $76,300. What is the return on equity?

39.92%

Allouette has earnings per share of $1.36. The firm's earnings have been increasing at an average rate of 2.9 percent annually and are expected to continue doing so. The firm has 21,500 shares of stock outstanding at a price per share of $23.40. What is the firm's PEG ratio?

5.93

Which one of the following standardizes items on the income statement and balance sheet relative to their values as of a chosen point in time?

Common-base year statement

Which one of the following is a source of cash?

Decrease in inventory

Which one of the following statements is correct?

Historical information is useful when projecting a company's future performance.

Which one of the following is a correct formula for computing the return on equity?

ROA × Equity multiplier

All other things beings equal, and assuming all ratios have positive values, an increase in current liabilities will:

decrease the quick ratio.

According to the statement of cash flows, an increase in interest expense will ______ the cash flow from ______ activities.

decrease; operating

Relationships determined from a company's financial information and used for comparison purposes are known as:

financial ratios.

All of the following issues represent problems encountered when comparing the financial statements of two separate entities except the issue of the companies:

having the same fiscal year.

Both Archer's and Burger Bar have price-earnings ratios of 16.2. However, Archer's has a higher PEG ratio than Burger Bar. It must be true that Archer's ______ than Burger Bar.

is increasing its earnings at a slower rate

The price-sales ratio is especially useful when analyzing firms that have:

negative earnings.

Happy Pets has annual sales of $328,000 with 8,000 shares of stock outstanding. The firm has a net profit margin of 4.5 percent and a price-sales ratio of 1.20. What is the firm's price-earnings ratio?

26.7

On the statement of cash flows, which one of the following is considered an operating activity?

Decrease in accounts payable

Oldie's Vintage has sales of $4,300, net income of $320, total assets of $4,800, and total equity of $2,950. Interest expense is $65. What is the common-size statement value of the interest expense?

1.51%

Soran Freight Forwarding has total assets of $694,800 at year's end. The beginning owners' equity was $362,400. During the year, the company had sales of $711,000, a net profit margin of 5.2 percent, a tax rate of 21 percent, and paid $12,500 in dividends. What is the equity multiplier at year end?

1.80

The Connection has an equity multiplier of 1.13, a total asset turnover of .56, and a net profit margin of 18.8 percent. What is the return on assets?

10.53%

Morgan Corporation has a debt-equity ratio of 48 percent, sales of $829,000, net income of $47,300, and total debt of $206,300. What is the return on equity?

11.01%

Bohensky's has net income of $73,402, a price-earnings ratio of 13.7, and earnings per share of $.43. How many shares of stock are outstanding?

170,702

Hamner Time has sales of $122,000, costs of $54,600, depreciation of $32,800, interest of $12,000, and a tax rate of 21 percent. The firm has total assets of $422,900, long-term debt of $146,800, and current liabilities of $65,200. What is the return on equity?

8.47%

Tellez Finance has current liabilities of $28,000, sales of $156,900, and cost of goods sold of $62,400. The current ratio is 1.22 and the quick ratio is .71. How many days, on average, does it take to sell the inventory?

83.53 days

Ratios that measure a firm's liquidity are known as ______ ratios.

short-term solvency

Corner Supply has a current accounts receivable balance of $246,000. Credit sales for the year just ended were $2,430,000. How many days, on average, did it take for credit customers to pay off their accounts during this past year?

36.95 days

AdVentures has sales of $528,700, costs of goods sold of $252,100, inventory of $43,900, accounts receivable of $78,900, and accounts payable of $32,400. How many days, on average, does it take the firm to sell its inventory assuming that all sales are on credit?

63.56 days

Billings Incorporated has net income of $161,000, a net profit margin of 7.6 percent, and an accounts receivable balance of $127,100. Assume that 66 percent of sales are on credit. What is the days' sales in receivables?

33.18 days

Castaneda Accounting has sales of $332,700, cost of goods sold of $221,800, inventory $13,700, accounts receivable of $22,400, and accounts payable of $11,900. How many days of sales are in receivables?

24.57 days

On a common-base year financial statement, inventory for the current year will be expressed relative to which one of the following?

Base-year inventory

The Natural Pet had sales of $763,500 in 2020, and $864,200 in 2021. The firm's current accounts remained constant. Given this information, which one of the following statements must be true?

The net working capital turnover rate increased.

If a firm has a debt-equity ratio of 1.0, then its total debt ratio must be which one of the following?

.5

Jacob's Escape has accounts payable of $2,214, inventory of $7,950, cash of $1,263, fixed assets of $8,400, accounts receivable of $3,907, and long-term debt of $4,200. What is the value of the net working capital to total assets ratio?

.51

Steele Video has sales of $96,400, costs of $53,800, interest paid of $2,800, and depreciation of $7,100. The tax rate is 21 percent. What is the value of the cash coverage ratio?

15.21