Homework Help is Here – Start Your Trial Now!
Business
Finance
Answer the following question a. Return on equity b. Total assets turnover c. Return on assets d. Current ratio e. Receivables turnover

Answer the following question a. Return on equity b. Total assets turnover c. Return on assets d. Current ratio e. Receivables turnover

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
See similar textbooks
icon
Related questions
Topic Video
Question

Answer the following question

a. Return on equity
b. Total assets turnover
c. Return on assets
d. Current ratio
e. Receivables turnover

There was a bit of concern about one of Big Rock's newer entities - Big Rock Paving Company. Management wants you to review the two financial statements below and give your analysis of the company's performance. Big Rock Paving Company Current Assets: Cash Assets Accounts Receivable Inventory Total Current Assets Fixed Assets: Property, Plant & Equipment Less: Accumulated Depreciation Net Fixed Assets Total Assets Current Liabilities: Accounts Payable 200,000 300,000 Notes Payable 800,000 1,300,000 Total Current Liabilities Owners' Equity: 2,200,000 Common Stock ($1 Par) 600,000 Capital Surplus 1,600,000 2,900,000 Sales Less: Cost of Goods Sold Retained Earnings Liabilities Big Rock Paving Company Income Statement for Year Ending December 31, 2021 Dividends Addition to Retained Earnings Total Owners' Equity Total Liabilities and Owners' Equity Less: Administrative Expenses Less Depreciation Earnings Before Interest and Taxes Less: Interest Expense Taxable Income Less: Taxes Net Income 3,400,000 2,700,000 700,000 682,000 (682,000) 120.000 (802,000) (280,000) (522,000) 0 (522,000) Required: Evaluate the performance of Big Rock Paving Company using the below ratios. Define each ratio, perform the calculation, and provide an explanation of the result. 700,000 600,000 1,300,000 600,000 100,000 100,000 800,000 2,900,000
Transcribed Image Text:There was a bit of concern about one of Big Rock's newer entities - Big Rock Paving Company. Management wants you to review the two financial statements below and give your analysis of the company's performance. Big Rock Paving Company Current Assets: Cash Assets Accounts Receivable Inventory Total Current Assets Fixed Assets: Property, Plant & Equipment Less: Accumulated Depreciation Net Fixed Assets Total Assets Current Liabilities: Accounts Payable 200,000 300,000 Notes Payable 800,000 1,300,000 Total Current Liabilities Owners' Equity: 2,200,000 Common Stock ($1 Par) 600,000 Capital Surplus 1,600,000 2,900,000 Sales Less: Cost of Goods Sold Retained Earnings Liabilities Big Rock Paving Company Income Statement for Year Ending December 31, 2021 Dividends Addition to Retained Earnings Total Owners' Equity Total Liabilities and Owners' Equity Less: Administrative Expenses Less Depreciation Earnings Before Interest and Taxes Less: Interest Expense Taxable Income Less: Taxes Net Income 3,400,000 2,700,000 700,000 682,000 (682,000) 120.000 (802,000) (280,000) (522,000) 0 (522,000) Required: Evaluate the performance of Big Rock Paving Company using the below ratios. Define each ratio, perform the calculation, and provide an explanation of the result. 700,000 600,000 1,300,000 600,000 100,000 100,000 800,000 2,900,000
Expert Solution
steps

Step by step

Solved in 4 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Ratio Analysis
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Essentials Of Investments
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
FUNDAMENTALS OF CORPORATE FINANCE
FUNDAMENTALS OF CORPORATE FINANCE
Finance
ISBN:
9781260013962
Author:
BREALEY
Publisher:
RENT MCG
Financial Management: Theory & Practice
Financial Management: Theory & Practice
Finance
ISBN:
9781337909730
Author:
Brigham
Publisher:
Cengage
Foundations Of Finance
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS