### Balance Sheet for Stuart Corporation#### Assets- **Current assets:** $238,000- **Long-term assets (net):** $770,000- **Total assets:** $1,008,000#### Liabilities- **Current liabilities:** $144,000- **Long-term liabilities:** $441,000- **Total liabilities:** $585,000#### Stockholders’ Equity- **Common stock and retained earnings:** $423,000#### Total Liabilities and Stockholders’ Equity- **Total:** $1,008,000### Required CalculationsCompute the following, rounding ratios to one decimal place:1. **Working capital:** (Calculate as current assets minus current liabilities)2. **Current ratio:** (Calculate as current assets divided by current liabilities)3. **Debt-to-assets ratio:** (Calculate as total liabilities divided by total assets, expressed as a percentage)4. **Debt-to-equity ratio:** (Calculate as total liabilities divided by stockholders' equity)This table provides a clear layout for the financial analysis calculations necessary to assess the financial health of Stuart Corporation.

Working capital - Working capital of a company is the difference between current assets & the current liabilities of the company.Current ratio - Current ratio measures the ability of the company to pay its short term liabilities.It is a type of liquidity ratio.Debt to asset ratio - It is a ratio which measures how much a company have debts in respect of its total assets.Debt to equity ratio - It is calculated by dividing total debt to shareholder's equity fund. 1 .Working capital = Current asset - Current Liabilities = $238,000- $144,000 = $94,000 2.Current Ratio= Current Assets / Current Liabilities = $238,000/$144,000 = 1.7 (round to 1 decimal places) 3.Debt to asset ratio = Total Debts / Total Asset = $585,000/ $1,008,000 = 0.6 (round to 1 decimal places) 4. Debt to equity ratio = Total debt /Total shareholders Equity = $585,000/ $423000 = 1.4 (round to 1 decimal places)Working capital $ 94,000current ratio 1.7debt to asset ratio0.6 debt to equity ratio1.4

Answered: Required Compute the following. (Round…

Business

Finance

Required Compute the following. (Round "Ratios" to 1 decimal place.) Working capital Current ratio Debt-to-assets ratio Debt-to-equity ratio %

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

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Concept explainers

Vertical Statement Analysis

Vertical statement analysis is a financial statements analysis tool that is used to establish a correlation between the base item and every line item in the financial statements. In vertical statement analysis, each line item in financial statements is reflected as a percentage of the base item. In the income statement, each line item is represented as a percentage of the gross turnover because gross turnover is considered as a base figure in income statement analysis. In the balance sheet, each line item is reflected as a percentage of total assets or liabilities.

Question

### Balance Sheet for Stuart Corporation

#### Assets
- **Current assets:** $238,000
- **Long-term assets (net):** $770,000
- **Total assets:** $1,008,000

#### Liabilities
- **Current liabilities:** $144,000
- **Long-term liabilities:** $441,000
- **Total liabilities:** $585,000

#### Stockholders’ Equity
- **Common stock and retained earnings:** $423,000

#### Total Liabilities and Stockholders’ Equity
- **Total:** $1,008,000

### Required Calculations
Compute the following, rounding ratios to one decimal place:

1. **Working capital:** (Calculate as current assets minus current liabilities)
2. **Current ratio:** (Calculate as current assets divided by current liabilities)
3. **Debt-to-assets ratio:** (Calculate as total liabilities divided by total assets, expressed as a percentage)
4. **Debt-to-equity ratio:** (Calculate as total liabilities divided by stockholders' equity)

This table provides a clear layout for the financial analysis calculations necessary to assess the financial health of Stuart Corporation.

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Assume you are given the following relationships for the Haslam Corporation: Sales/total assets 1.7 Return on assets (ROA) 4% Return on equity (ROE) 6% Calculate Haslam's profit margin and liabilities-to-assets ratio. Do not round intermediate calculations. Round your answers to two decimal places. Profit margin: % Liabilities-to-assets ratio: % Suppose half of its liabilities are in the form of debt. Calculate the debt-to-assets ratio. Do not round intermediate calculations. Round your answer to two decimal places. %
For Financial year 2021: Current ratio = Current assets / Current liabilities = 43.133 / 29.613 = 1.46 (2.d.p) Debt-to-equity = Total liabilities / Total equity = (29.613 + 25.382) / 47.069 = 1.17 (2.d.p) Return on total assets = Net profit / Average total assets = (-11.195) / 101.964 = -0.11 (2.d.p) Profit margin ratio = Net profit / Net sales = (-11.195) / 81.79 = -0.14 (2.d.p) Debt-to-asset = Total liabilities / Total assets = (29.613 + 25.382) / 101.964 = 0.54 (2.d.p) Cash flow on total assets = Net cash flow from operating activities / Average total assets = 4.717 / 101.964 = 0.05 (2.d.p) For Financial year 2022: Current ratio = Current assets / Current liabilities = 49.476 / 32.754 = 1.51 (2.d.p) Debt-to-equity = Total liabilities / Total equity = (32.754 + 27.625) / 46.732 = 1.29 (2.d.p) Return on total assets = Net profit / Average total assets = (-0.336) / 107.111 = -0.003 (3.d.p) Profit margin ratio = Net profit / Net sales = (-0.336) / 115.56 = -0.003 (3.d.p) Debt-to-asset…
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RATIO ANALYSIS. Debt Ratio Activity 6 · Understand the information provided by the debt ratio. · Identify the expected range and whether an increasing or decreasing trend is preferred. Purpose: The debt ratio compares total liabilities to total assets. This ratio measures the proportion of assets financed by debt. It is a measure of long-term solvency. Total liabilities DEBT RATI0 = Total assets JOHNSON & CITIGROUP 12/31/99 HEWLETT- PACKARD 10/3 1/99 JOHNSON 1/03/99 WAL-MART 1/31/99 ($ in 000s) Assets $716,937,000 $35,297,000 $26,211,000 $49,996,000 Liabilities 667,251,000 17,002,000 12,621.000 28,884,000 Stockholders' Equity $ 49,686,000 $18,295,000 $13,590,000 $21,112,000 Source: Disclosure, Inc, Compact D/SEC, 2000. 1. For each-company listed above, compute the debt ratio. Record your results below. Debt ratio: 0.93 2. The debt ratios computed above are primarily in the ranġe (less than 0,40 / 0.40 through 0.70 / over 0.70): 3. % of Wal-Mart's assets are financed by debt. 4.…
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Given the following information for the Duke Tire Company, find the firm's debt ratio (i.e., total liabilities / total assets): ROE (N/E) = 0.37 (expressed as a decimal) Total asset turnover ratio (S/A) = 2.2 Net profit margin (N/S) = 0.09 (expressed as a decimal)
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