Finance Midterm Ch 3 questions

Stone Walls has a long-term debt ratio of .6 and a current ratio of 1.2. Current liabilities are $800, sales are $7,800, the net profit margin is 6.5 percent, and return on equity is 15.5 percent. What is the amount of the firm's net fixed assets?

$8,017.43

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

A firm has inventory of $29,406, accounts receivable of $46,215, net working capital of $4,507, and current liabilities of $90,549. What is the quick ratio?

.75

Anytime Coffee has 160,000 shares of stock outstanding, sales of $1.94 million, net income of $126,400, a price-earnings ratio of 21.3, and a book value per share of $7.92. What is the market-to-book ratio?

2.12

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%

An increase in which one of the following will increase a firm's quick ratio without affecting its cash ratio?

Accounts receivable

Which one of the following is a source of cash?

Acquisition of debt

The relationship between the return on assets and the return on equity is identified by the:

DuPont identity.

At the beginning of the year, Scoopers Ice Cream had cash of $183, accounts receivable of $392, accounts payable of $463, and inventory of $714. At year end, cash was $167, accounts payable was $447, inventory was $682, and accounts receivable was $409. What is the amount of the net source or use of cash by working capital accounts for the year?

Net source of $15 cash

The coding system established by the U.S. government to classify companies by the nature of their business operations is known as the:

Standard Industrial Classification codes.

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 inventory will ______ the cash flow from ______ activities.

decrease; operating

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

A common-size income statement is an accounting statement that expresses all of a firm's expenses as a percentage of:

sales.

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

short-term solvency

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%

Domingo Electric has a PEG ratio of 5.3, net income of $49,200, a price-earnings ratio of 17.6, and a net profit margin of 7.1 percent. What is the earnings growth rate?

3.32%

BL Industries has ending inventory of $302,800, annual sales of $2.33 million, and annual cost of goods sold of $1.41 million. On average, how long did a unit of inventory sit on the shelf before it was sold?

78.38 days

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

Park Resources has sales of $687,400, cost of goods sold of $454,200, and a net profit margin of 5.5 percent. The balance sheet shows common stock of $324,000 with a par value of $5 a share, and retained earnings of $689,500. What is the price-sales ratio if the market price is $43.20 per share?

4.07