1. You are evaluating the balance sheet for Goodman\'s Bees Corporation. From th

Question

1. You are evaluating the balance sheet for Goodman's Bees Corporation. From the balance sheet you find the following balances: cash and marketable securities = $310,000, accounts receivable = $2,100,000, inventory = $1,800,000, accrued wages and taxes = $680,000, accounts payable = $980,000, and notes payable = $780,000.

Calculate Goodman Bees' net working capital.

2. The Fitness Studio, Inc.’s 2018 income statement lists the following income and expenses: EBIT = $549,000, interest expense = $98,000, and net income = $428,000.

Calculate the 2018 taxes reported on the income statement.

3. Tiggie's Dog Toys, Inc. reported a debt-to-equity ratio of 1.85 times at the end of 2018. If the firm's total debt at year-end was $35 million, how much equity does Tiggie's have on its balance sheet?

4. you are considering a stock investment in one of two firms (LotsofDebt, Inc. and LotsofEquity, Inc.), both of which operate in the same industry. LotsofDebt, Inc. finances its $31.00 million in assets with $29.50 million in debt and $1.50 million in equity. LotsofEquity, Inc. finances its $31.00 million in assets with $1.50 million in debt and $29.50 million in equity.

Calculate the debt ratio. (Round your answers to 2 decimal places.)

Calculate the equity multiplier. (Round your answers to 2 decimal places.)

Calculate the debt-to-equity. (Round your answers to 2 decimal places.)

5.

Last year, Hassan’s Madhatter, Inc. had an ROA of 7.2 percent, a profit margin of 13.70 percent, and sales of $20 million.

Calculate Hassan’s Madhatter’s total assets

Explanation / Answer

1.

You are evaluating the balance sheet for Goodman's Bees Corporation. From the balance sheet you find the following balances: cash and marketable securities = $310,000, accounts receivable = $2,100,000, inventory = $1,800,000, accrued wages and taxes = $680,000, accounts payable = $980,000, and notes payable = $780,000.

Calculate Goodman Bees' net working capital

Net working capital = Total current Assets - Total Current laibilities =(310000+2100000+1800000) -(680000 +980000+780000) =1770000

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