The most recent financial statements for Martin, Inc., are shown here: Income Statement Sales $18,000 -10,800 $7,200 -1,512 Costs Taxable income Taxes (21%) Net income $5,688 Balance Sheet $40,000 33,800 Assets $73,800 Debt Equity Total $73,800 Total $73,800 Assets and costs are proportional to sales. Debt and equity are not. A dividend of $985 was paid, and Martin wishes to maintain a constant payout ratio. Next year's sales are projected to be $22,320. What is the external financing needed? (Do not round intermedinte celsul

The most recent financial statements for Martin, Inc., are shown here: Income Statement Sales $18,000 -10,800 $7,200 -1,512 Costs Taxable income Taxes (21%) Net income $5,688 Balance Sheet $40,000 33,800 Assets $73,800 Debt Equity Total $73,800 Total $73,800 Assets and costs are proportional to sales. Debt and equity are not. A dividend of $985 was paid, and Martin wishes to maintain a constant payout ratio. Next year's sales are projected to be $22,320. What is the external financing needed? (Do not round intermedinte celsul

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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For the past year, Momsen Limited had sales of $45,017, interest expense of $3,308, cost of goods sold of $15,434, selling and administrative expense of $11,101, and depreciation of $5,400. If the tax rate was 21 percent, what was the company's net income? Multiple Choice $6,842 $4,541, $9,774 $7,721
Selected balance sheet and income statement information from Illinois Tool Works follows. $ millions Net operating profit after tax (NOPAT) $2,897 $3,009 Net income 2,798 2,845 Total assets 15,671 15,465 $17,451 Equity 3,147 3,384 3,384 10,493 Net operating profit after tax (NOA) 9,224 9,840 Treasury stock 21,070 19,475 17,274 a. Compute profitability measures: RNOA, ROA and ROE for 2019 and 2018 using the numbers as reported by the company. Note: Round answers to one decimal place (ex: 0.2345 = 23.5%). Metric RNOA ROA ROE 2019 30.4 % 17.9 % ✓ 88.91 % * $ millions Assets, restated $ Equity, restated b. Adjust equity and total assets for the amount of treasury stock. 2019 2018 34,940 $ 36,741 $ 24,217 ✔ $ 22,859 $ 2019 2018 30.4 % 8.08 % * 2019 2018 2017 11.89% 29.6 % 18.28 % * 84.1 %✔ Using these restated numbers, recompute RNOA, ROA and ROE for both years. Note: Round answers to one decimal place (ex: 0.2345 = 23.5%). Metric RNOA ROA ROE 2018 2017 29.6 % 8.64 % * 13.08% ✔ 34,725…
The financial statements for Armstrong and Blair companies for the current year are summarized below: Blair Company Statement of Financial Position Cash Accounts receivable (net) Inventory Property, plant, and equipment (net) Other non-current assets Total assets Current liabilities. Long-term debt (10%) Share capital Contributed surplus Retained earnings Total liabilities and shareholders' equity Statement of Earnings Sales revenue (1/3 on credit) Cost of sales Expenses (including interest and income tax) Net earnings Accounts receivable (net) Inventory Long-term debt Other data: Share price year-end Income tax rate Dividends declared and paid Shares Outstanding $ Selected data from the financial statements for the previous year follows: Blair Company Armstrong Company 30,000 82,000 94,000 $ 50,000 28,000 86,000 $ $ 18 30% 46,000 15,000 Armstrong Company $ 36,000 $ 32,000 30,000 40,000 205,000 35,000 170,000 95,000 $ 536,000 $ 125,000 94,000 180,000 40,000 97,000 $ 536,000 $ 550,000…
Given the following information for Blue Bell Company for last year: Net sales (all on account) $5,200,000 Cost of goods sold 2,080,000 Interest expense 240,000 Income tax expense 280,000 Net income 420,000 Income tax rate 40% Total assets: January 1 $1,800,000 December 31 2,400,000 Shareholders' equity (all common): January 1 1,500,000 December 31 1,600,000 Current assets, December 31 700,000 Quick assets, December 31 400,000 Current liabilities, December 31 300,000 Net accounts receivable: January 1 200,000 December 31 180,000 Inventory: January 1 210,000 December 31 250,000 Refer to Exhibit 4-1. Blue Bell's debt to assets ratio December 31 was A16.7% B26.2% C42.8% D33.3%
Strider Outfitters declared and paid a cash dividend of $8,900 in the current year. Its comparative financial statements, prepared at December 31, reported the following summarized information: Current Year Previous Year Income Statement $ 225,000 98,000 127,000 59,000 6,300 $ 191,000 94,000 Sales Revenue Cost of Goods Sold Gross Profit 97,000 51,400 6,300 Operating Expenses Interest Expense Income before Income Tax Expense Income Tax Expense (30%) 61,700 18,510 39,300 11,790 $ 43,190 $ 27,510 Net Income Balance Sheet $ 99,515 40,000 48,000 118,000 $ 15,000 35,000 61,000 128,000 Cash Accounts Receivable, Net Inventory Property and Equipment, Net $ 305,515 $ 65,000 $ 239,000 $ 32,700 Total Assets Accounts Payable Income Tax Payable Notes Payable (long-term) 1,575 63,000 129,575 103,800 72,140 1,650 63,000 97,350 103,800 37,850 $ 239,000 Total Liabilities Common Stock (par $10) Retained Earnings Total Liabilities and Stockholders' Equity $ 305,515 Required: 1. Compute the gross profit…
Here are simplified financial statements for Phone Corporation in a recent year: INCOME STATEMENT (Figures in $ millions) Net sales $ 14,000 Cost of goods sold 4,510 Other expenses 4,212 Depreciation 2,788 Earnings before interest and taxes (EBIT) $ 2,490 Interest expense 730 Income before tax $ 1,760 Taxes (at 30%) 528 Net income $ 1,232 Dividends $ 946 BALANCE SHEET (Figures in $ millions) End of Year Start of Year Assets Cash and marketable securities $ 98 $ 167 Receivables 2,832 2,670 Inventories 232 283 Other current assets 912 977 Total current assets $ 4,074 $ 4,097 Net property, plant, and equipment 20,063 20,005 Other long-term assets 4,306 3,860 Total assets $ 28,443 $ 27,962 Liabilities and shareholders’ equity Payables $ 2,654 $ 3,130 Short-term debt 1,464 1,618 Other current…
The most recent financial statements for Camryn, Incorporated, are shown here (assuming no income taxes): Income Statement Sales Costs Balance Sheet $6,500 Assets $23,500 Debt $ 9,500 4,610 Equity 14,000 Net income $1,890 Total $ 23,500 Total $ 23,500 Assets and costs are proportional to sales. Debt and equity are not. No dividends are paid. Next year's sales are projected to be $7,150. What is the external financing needed? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) External financing needed
The most recent financial statements for Alexander Company are shown here: Income Statement Balance Sheet Sales $ 55,000 Current assets $ 86,130 Long-term debt $ 59,400 Costs 35,200 Fixed assets 47,520 Equity 74,250 Taxable income $ 19,800 Total $ 133,650 Total $ 133,650 Taxes (22%) 4,356 Net income $ 15,444 Assets and costs are proportional to sales. The company maintains a constant 36 percent dividend payout ratio and a constant debt-equity ratio. What is the maximum increase in sales that can be sustained assuming no new equity is issued?
the income statement for Stretch-Tape Corporation reports net sales of $439,900 and net income of $54,780. Average total assets for the year are $830,000. Stockholders’ equity at the beginning of the year was $530,000, and $23,000 was paid to stockholders as dividends during the year. There were no other stockholders’ equity transactions that occurred during the year.Required:Calculate the return on assets, profit margin, asset turnover, and return on equity ratios. (Round your answers to 1 decimal place.) Profitability Ratios Return on assets 6.6 % Profit margin 12.5 % Asset turnover times Return on equity %
The most recent financial statements for Bradley, Inc., are shown here (assuming no income taxes): Sales Costs Income Statement. Net income Assets: Total EFN $6,800 -4,080 $2,720 Balance Sheet. $20,400 Debt $20,400 Equity Total $10,600 9,800 $20,400 Assets and costs are proportional to sales. Debt and equity are not. No dividends are paid. Next year's sales are projected to be $7,752. What is the external financing needed? (A negative value should be indicated by a minus si Do not round intermediate calculations. Round your answer to the nearest whole number.)
WD Corporation reports the following year-end balance sheet data. The company's debt-to-equity ratio equals: Cash $ 42,000 Current liabilities $ 77,000 Accounts receivable 57,000 Long-term liabilities 28,000 Inventory 62,000 Common stock 102,000 Equipment 147,000 Retained earnings 101,000 Total assets $ 308,000 Total liabilities and equity $ 308,000
The Year 2 fiscal year-end financial statements for Walter Co. report revenues of $55,743 million, net operating profit after tax of $9,954 million, net operating assets of $58,720 million. The Year 1 fiscal year-end balance sheet reports net operating assets of $59,197 million.Walter's Year 2 net operating profit margin (NOPM) is:

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