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    Finance: Ratio analysis

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    Please show work or calculations if you use a business calculator.

    Use the following financial sheets and information for all questions.

    The balance sheet and income statement shown below are for Apple Jax Inc. Note that the firm has no amortization charges, it does not lease any assets, none of its debt must be retired during the next 5 years, and the notes payable will be rolled over.

    Tax rate 40%
    Stock price $17.00
    Shares outstanding 3,800,000
    Dividends are 50% of net income

    Income Statement
    Period Ending 31-Dec-13
    Total Revenue 148,239,000
    COGS 118,094,000
    Selling General and Administrative 13,384,000
    Depreciation 72,000
    Earnings Before Interest And Taxes 16,689,000
    Interest Expense 829,000
    Income Before Tax 15,860,000
    Income Tax Expense (40%) 6,344,000

    Net Income 9,516,000
    Balance Sheet
    Date 31-Dec-13
    Assets
    Current Assets
    Cash 14,468,000
    Net Receivables 98,359,000
    Inventory 18,758,000
    Total Current Assets 131,585,000

    Property Plant and Equipment 70,441,000

    Total Assets 202,026,000

    Liabilities
    Current Liabilities
    Accounts Payable 22,446,500
    Accruals 14,315,500
    Notes Payable 3,631,000
    Total Current Liabilities 40,393,000

    Long Term Debt 134,919,000

    Total Liabilities 175,312,000

    Stockholders' Equity
    Common Stock 40,000
    Retained Earnings 26,674,000

    Total Stockholder Equity 26,714,000

    Total Assets 202,026,000


    Question/Problem 1) (Worth 30 points)
    1. What is the firm's current ratio?
    2. What is the firm's days-sales-outstanding (DSO)? Assume a 360-day year for this calculation.
    3. What is the firm's total assets turnover?
    4. What is the firm's inventory turnover ratio?
    5. What is the firm's TIE?
    6. What is the firm's ROA?
    7. What is the firm's basic earning power?
    8. What is the firm's ROE?
    9. What is the firm's P/E ratio?
    10. What is the firm's market-to-book ratio?

    Question/Problem 2) (Worth 50 points)
    Calculate the additional or external funds needed if the firm is expecting a growth rate of 10% next year. The firm is currently operating at 95% of capacity and the fixed assets can only by $10,000,000 increments.

    Question/Problem 3) (Worth 20 points)
    Calculate the common size balance sheet and the common size income statement for the company.

    © BrainMass Inc. brainmass.com October 10, 2019, 7:40 am ad1c9bdddf
    https://brainmass.com/business/dividends-stock-repurchase-and-policy/finance-ratio-analysis-590563

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    Bus Finance
    Practice Test - 2

    Please show work or calculations if you use a business calculator. Use the following financial sheets and information for all questions.

    The balance sheet and income statement shown below are for Apple JaxInc. Note that the firm has no amortization charges, it does not lease any assets, none of its debt must be retired during the next 5 years, and the notes payable will be rolled over.

    Tax rate 40%
    Stock price $17.00
    Shares outstanding 3,800,000
    Dividends are 50% of net income

    Income Statement
    Period Ending 31-Dec-13
    Total Revenue 148,239,000
    COGS 118,094,000
    Selling General and Administrative 13,384,000
    72,000
    Earnings Before Interest And Taxes 16,689,000
    Interest Expense 829,000
    Income Before Tax 15,860,000
    Income Tax Expense (40%) 6,344,000

    Net Income 9,516,000

    Date 31-Dec-13
    Assets
    Current Assets
    Cash 14,468,000
    Net Receivables 98,359,000
    Inventory 18,758,000
    Total Current Assets 131,585,000

    Property Plant and ...

    Solution Summary

    The problem set deals with ratio analysis. The balance sheet and income statement for Apple amortization rates are given.

    $2.19