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Homework 3/financial ratios 1. 50, find CR and QR CA 300, Cl-200, inventory 2. A

ID: 2618998 • Letter: H

Question

Homework 3/financial ratios 1. 50, find CR and QR CA 300, Cl-200, inventory 2. AR-600. Sales 3650, find ACP 3, EBIT = 800, 1200, find TIER 4. LTD-500, CL-100, TA-2000, find DR 5. LTD-500, CL-100, CS-300, RE-100. Find Debt/equity ratio 6. Inventory 100, COGS-1200, find ITR 7. EBIT -400, Sales 1000, find operating profit margin 8. EAT 400, Preferred stock dividends-100, n-number of common stocks outstanding 600, find EPS EPS-2, Stock P-28, find P/E ratio 9. 10. EAC-200, CS-800, RE-200, find ROE 85 Words English (US) ?? ? ?Focus

Explanation / Answer

(1) CA = 300, CL = 200, Inventory = 50

CR(Current Ratio) = CA / CL = 300 / 200 = 1.5

Quick Ratio (QR) = (300 - 50) / 200 = 1.25

(2) Account Receivables (AR) = 600, Sales = 3650

Account Receivables Turnover Ratio = 3650 / 400

ACP (Accounts Receivable Turnover Period) = (365 / 3650) x400 = 40 days

(3) EBIT = 800 and i (interest expense) = 200

TIER (Times Interest Earned Ratio) = 800 / 200 = 4

(4) LTD (Long-Term Debt) = 500, CL (Current Liablity) = 100

TA(Total Assets) = 2000

DR(Debt Ratio) = (LTD + CL) / TA = (500 + 100) / 2000 = 0.3

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