Exam 3: Working With Financial Statements

Russell's Hardware has inventory of $218,000, equity of $421,800, total assets of $647,700, and sales of $587,200. What is the common-size percentage for the inventory account?

Assume this is your first day on the job as the new chief financial officer of a mid-size company. Identify the three key ratios that you would compute first as you begin to try to understand the financial status of the firm. Explain why you selected the three ratios that you did.

Galaxy Sales has sales of $746,700, cost of goods sold of $603,200, and inventory of $94,300. How long on average does it take the firm to sell its inventory?

True Blue Transport has a current stock price of $27. For the past year, the company had net income of $2,187,400, total equity of $13,892,300, sales of $26,511,000, and 2.5 million shares outstanding. What is the market-to-book ratio?

Financial statement analysis:

The Donut Hut has sales of $68,000, current assets of $11,300, net income of $5,100, net fixed assets of $54,900, total debt of $23,800, and dividends of $800. What is the sustainable growth rate?

Tressler Dry Cleaners has inventory of $1,700, accounts payable of $4,200, cash of $1,950, and accounts receivable of $3,680. What is the cash ratio?

A firm has net income of $31,300, depreciation of $5,100, taxes of $14,600, and interest paid of $3,100. What is the cash coverage ratio?

The Next Life has sales of $428,300, total assets of $389,100, and a profit margin of 6.2 percent. What is the return on assets?

The ratios that are based on financial statement values and used for comparison purposes are called:

A firm has sales of $311,000 and net income of $21,600. Currently, there are 18,000 shares outstanding at a market price of $36 per share. What is the price-sales ratio?

The Jelly Jar has total assets of $79,600 and an equity multiplier of 1.35. What is the debt-equity ratio?

Martha's Fabric House has sales of $137,200, total equity of $74,400, and a debt-equity ratio of 0.45. What is the capital intensity ratio?

Aardvaark & Co. has sales of $291,200, cost of goods sold of $163,300, net profit of $11,360, net fixed assets of $154,500, and current assets of $89,500. What is the total asset turnover rate?

You are analyzing a company that has cash of $11,200, accounts receivable of $27,800, fixed assets of $124,600, accounts payable of $31,300, and inventory of $56,900. What is the quick ratio?

Circle Stores has net income of $41,000, a profit margin of 6.7 percent, and a return on assets of 9 percent. What is the capital intensity ratio?

Taylor, Inc. has sales of $11,898, total assets of $9,315, and a debt-equity ratio of 0.55. If its return on equity is 14 percent, what is its net income?

Preston's Market has sales of $213,600, total assets of $198,700, a debt-equity ratio of 1.6, and a profit margin of 2.4 percent. What is the equity multiplier?

Gabriel Furniture has a profit margin of 8.2 percent and a dividend payout ratio of 30 percent. What is the plowback ratio?

Fred is the owner of a local feed store. Which one of the following ratios should he compute if he wants to know how long the store can pay its bills given the amount of cash the store currently has?