Exam 3: Financial Statements Analysis and Financial Models

Charlotte's has current sales of $122,000,current liabilities of $16,400,and net working capital of $2,100.The projected sales for next year are $134,000.All net working capital accounts change directly with sales.What is the projected value of current assets for next year?

A firm has 35,000 shares of stock outstanding,sales of $767,000,net income of $84,900,a price-earnings ratio of 16.4,and a book value per share of $9.60.What is the market-to-book ratio?

Identify the three parts of the DuPont identity and specify what each part measures.

A firm has a total debt ratio of .53.This means the firm has $.53 in debt for every:

If a firm decreases its operating costs,all else constant,then:

Nelson Farms has 12,500 shares of stock outstanding with a market value of $11.20 a share and $68,000 of debt bearing an interest rate of 6.7 percent.Current assets consist of $2,800 in cash,$16,400 in accounts receivable,and $31,200 in inventory.Accounts payable are $27,300.What is the firm's enterprise value?

A supplier,who requires payment within ten days,should be most concerned about which one of its customer's ratios?

Which ratio identifies the amount shareholders are willing to pay for each $1 per share of earnings a firm generates?

Which ratio measures the number of times a firm lends money to customers,collects that money,and relends it within a year?

A firm has sales of $2,400,net income of $125,total assets of $1,100,and total equity of $750.Interest expense is $200.What is the common-size statement value of the interest expense?

What is the purpose of the enterprise value measure?

If a firm produces a 12 percent return on assets and also a 12 percent return on equity,then the firm:

The Purple Cove has a 5 percent profit margin and a 40 percent dividend payout ratio.The total asset turnover is 1.40 and the equity multiplier is 1.50.What is the sustainable rate of growth?

If a non-dividend paying firm bases its growth assumptions on the sustainable rate of growth,and shows positive net income,then the pro forma statement must reflect:

Which is a more meaningful measure of profitability for a firm,return on assets or return on equity? Why?

Which one of these combinations will provide sufficient information to determine the sustainable growth rate of a firm?

The internal rate of growth is based on the assumption that:

The return on equity can be calculated as:

Juno's has sales of $389,000,a tax rate of 34 percent,a dividend payout ratio of 45 percent,and a profit margin of 6 percent.What is the addition to retained earnings?

A total asset turnover measure of 1.03 means that a firm has $1.03 in: