{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

ch2-hwsolutions

# ch2-hwsolutions - (i Return on total assets =(\$239,935...

This preview shows page 1. Sign up to view the full content.

Solutions of problems assigned in Chapter 2 Chapter 2 4, 7, 9 2.4 (a) Debt ratio = (\$922,653 + \$113,186)/\$4,834,690 = 42.10% (b) Time-interest-earned ratio = (\$432,342 + \$36,479)/\$36,479 = 12.85 times (c) Current ratio = \$3,994,084/\$1,113,186 = 3.59 times (d) Quick ratio = (\$3,994,084 - \$1,080,083)/\$1,113,186 = 2.62 times (e) Inventory turn over ratio = \$8,391,409/((\$1,080,083 + \$788,519)/2) = 8.98 times (f) DSO = (\$1,123,901 - \$5,580)/(\$8,391,409/360) = 47.98 days (g) Total assets turnover ratio = \$8,391,409/\$4,834,696 = 1.74 times (h) Profit margin on sales = \$293,935/\$8,391,409 = 3.5%
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: (i) Return on total assets = (\$239,935 + \$36,479(1 – 0.3201))/((\$4,834,696 + \$2,410,568)/2) = 8.80% (j) Return on common equity = \$293,935/((\$2,793,091 + \$1,181,326)/2) = 14.79% (k) Price-Earning ratio = \$65/\$1.13 = \$57.52 Note: Assumed a share price of \$65. The stock prices were fluctuating between \$78.93 and \$52.25 during the fourth quarter. (l) Book value per share = \$2,793,091,000/247,004,200 = \$11.30 (Note: The total outstanding number of shares in year 2005 was 247,004,200.) 2.7 Answer is (b) 2.9 Answer is (b)...
View Full Document

{[ snackBarMessage ]}

Ask a homework question - tutors are online