Quantitative Problem: Rosnan Industries' 2018 and 2017 balance sheets and income statements are shown below. Balance Sheets: 2018 2017 Cash and equivalents $70 $55 Accounts receivable 275 300 Inventories 375 350 Total current assets $720 $705 Net plant and equipment 2,000 1,490 Total assets $2,720 $2,195 Accounts payable $150 $85 Accruals 75 50 Notes payable 120 145 Total current liabilities $345 $280 Long-term debt 450 290 Common stock 1,225 1,225 Retained earnings 700 400 Total liabilities and equity $2,720 $2,195 Income Statements: 2018 2017 Sales $2,000 $1,500 Operating costs excluding depreciation 1,250 1,000 EBITDA $750 $500 Depreciation and amortization 100 75 EBIT $650 $425 Interest 62 45 EBT $588 $380 Taxes (40%) 235 152 Net income $353 $228 Dividends paid $53 $48 Addition to retained earnings $300 $180 Shares outstanding 100 100 Price $25.00 $22.50 WACC 10.00% What is the firm’s 2018 current ratio? Round your answer to two decimal places. What is the firm’s 2018 net profit margin? Round your answer to four decimal places. % What is the firm’s 2018 price/earnings ratio? Round your answer to two decimal places.
Quantitative Problem: Rosnan Industries' 2018 and 2017 balance sheets and income statements are shown below. Balance Sheets: 2018 2017 Cash and equivalents $70 $55 Accounts receivable 275 300 Inventories 375 350 Total current assets $720 $705 Net plant and equipment 2,000 1,490 Total assets $2,720 $2,195 Accounts payable $150 $85 Accruals 75 50 Notes payable 120 145 Total current liabilities $345 $280 Long-term debt 450 290 Common stock 1,225 1,225 Retained earnings 700 400 Total liabilities and equity $2,720 $2,195 Income Statements: 2018 2017 Sales $2,000 $1,500 Operating costs excluding depreciation 1,250 1,000 EBITDA $750 $500 Depreciation and amortization 100 75 EBIT $650 $425 Interest 62 45 EBT $588 $380 Taxes (40%) 235 152 Net income $353 $228 Dividends paid $53 $48 Addition to retained earnings $300 $180 Shares outstanding 100 100 Price $25.00 $22.50 WACC 10.00% What is the firm’s 2018 current ratio? Round your answer to two decimal places. What is the firm’s 2018 net profit margin? Round your answer to four decimal places. % What is the firm’s 2018 price/earnings ratio? Round your answer to two decimal places.
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
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Quantitative Problem: Rosnan Industries' 2018 and 2017
| Balance Sheets: | ||
| 2018 | 2017 | |
| Cash and equivalents | $70 | $55 |
| Accounts receivable | 275 | 300 |
| Inventories | 375 | 350 |
| Total current assets | $720 | $705 |
| Net plant and equipment | 2,000 | 1,490 |
| Total assets | $2,720 | $2,195 |
| Accounts payable | $150 | $85 |
| Accruals | 75 | 50 |
| Notes payable | 120 | 145 |
| Total current liabilities | $345 | $280 |
| Long-term debt | 450 | 290 |
| Common stock | 1,225 | 1,225 |
| 700 | 400 | |
| Total liabilities and equity | $2,720 | $2,195 |
| Income Statements: | ||
| 2018 | 2017 | |
| Sales | $2,000 | $1,500 |
| Operating costs excluding |
1,250 | 1,000 |
| EBITDA | $750 | $500 |
| Depreciation and amortization | 100 | 75 |
| EBIT | $650 | $425 |
| Interest | 62 | 45 |
| EBT | $588 | $380 |
| Taxes (40%) | 235 | 152 |
| Net income | $353 | $228 |
| Dividends paid | $53 | $48 |
| Addition to retained earnings | $300 | $180 |
| Shares outstanding | 100 | 100 |
| Price | $25.00 | $22.50 |
| WACC | 10.00% |
What is the firm’s 2018 current ratio? Round your answer to two decimal places.
What is the firm’s 2018 net profit margin? Round your answer to four decimal places.
%
What is the firm’s 2018 price/earnings ratio? Round your answer to two decimal places.
Using the DuPont equation, what is the firm’s 2018
%
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