1. A. the following data apply to Jacobs and Associates (millions of dollars): Cash and marketable securities $ 100.00 Fixed assets =$ 283.50 Net income= $ 50.00 Sales =$1,000.00 Quick ratio =2.0 Current ratio= 3.0 DSO =40.55 days ROE =12% Jacobs has no preferred stock-only common equity, current liabilities, and long-term debt. Find Jacobs's A. Accounts receivable, B. Current liabilities, C. Current assets, D. Total assets, E. ROA, F. Common equity, and G. Long-term debt. Counts

1. A. the following data apply to Jacobs and Associates (millions of dollars): Cash and marketable securities $ 100.00 Fixed assets =$ 283.50 Net income= $ 50.00 Sales =$1,000.00 Quick ratio =2.0 Current ratio= 3.0 DSO =40.55 days ROE =12% Jacobs has no preferred stock-only common equity, current liabilities, and long-term debt. Find Jacobs's A. Accounts receivable, B. Current liabilities, C. Current assets, D. Total assets, E. ROA, F. Common equity, and G. Long-term debt. Counts

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

1. A. the following data apply to Jacobs and Associates
(millions of dollars):
Cash and marketable securities $ 100.00
Net income%= $ 50.00
Fixed assets =$ 283.50
Sales =$1,000.00
Quick ratio =2.0
Current ratio= 3.0
DSO =40.55 days
ROE =12%
Jacobs has no preferred stock-only common equity, current
liabilities, and long-term debt. Find Jacobs's
A. Accounts receivable,
B. Current liabilities,
C. Current assets,
D. Total assets,
E. ROA,
F. Common equity, and
G. Long-term debt.
1B. in part A, you should have found Jacobs's accounts
receivable = $111.1 million. If Jacobs could reduce its DSO
from 40.55 days to 30.4 days while holding other things
constant, how much cash would it generate? If this cash
were used to buy back common stock (at book value), thus
reducing the amount of common equity, how would this
affect
i.
The ROE
ii. The ROA
iii.
The ratio of total debt to total assets?

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