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Unformatted text preview: approximate annual averages.) 1. Return on assets. 2. Return on stockholders' equity. 3. Debt to assets ratio. (b) Briefly discuss the operating performance and financial position of Sepracor. Industry averages for these ratios in 2007 were: ROA 3.5%; return on equity 16%; and debt to assets 75%. Based on this analysis would you make an investment in the company's 5% convertible bonds? Explain. (c) Assume you want to compare Sepracor to an international company, like Bayer (which prepares its financial statements in accordance with iGAAP). Assuming that the fair value of the equity component of Sepracor's convertible bonds is $150,000, how would you adjust the analysis above to make valid comparisons between Sepracor and Bayer?...
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- Spring '11
- Generally Accepted Accounting Principles, convertible bonds, convertible subordinated debt, sepracor, Sepracor, Inc.