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    Business ratios

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    APPENDIX... Use to calculate ratios

    Income Statement
    2007

    Sales 3,000

    Cost of Goods (1,350)

    Sell,Admin,Gen'l Expenses (1,050)

    Interest Expense (150)

    Profit Before Tax 450

    Tax (180)

    Profit after Tax 270

    Balance Sheet
    12/31/2007

    Receivables 275
    Inventory 175
    Current Assets 450
    Fixed Assets 650

    Total Assets 1,100

    Trade Payables 250
    Short term Debt 50
    Long term debt 150
    Total Liabilities 450

    Capital Stock 300
    Retained earnings 350
    Total Equity 650

    Total Liab & Equity 1,100

    Some questions I need help with are:

    What is the Gross Profit for 2007 ?

    What is your Operating profit ?

    What is the Profit after tax margin (%)?

    What is the Return on Assets (%)?

    What is the Return on Equity (%)?

    Calculate DSO's for 2007

    How does the DSO in the above question compare to an Industry avg DSO of 35 days?

    A Favorably
    B Unfavorably

    What is the Inventory turn rate ?

    How does the Turn rate above compare to an Industry avg turn of 8 x's ?

    A Favorably
    B Unfavorably

    What is the quick ratio ?

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    https://brainmass.com/business/business-math/business-ratios-234176

    Solution Preview

    Sales 3,000

    Less Cost of Goods -1,350

    Gross Profit 1,650

    Less Sell,Admin,Gen'l Expenses -1,050

    Operating Profit 600

    Interest Expense (150)

    Profit Before Tax 450

    Tax (180)

    Profit after Tax 270

    What is the Profit after ...

    Solution Summary

    Response provides the steps to compute the Business ratios

    $2.19

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