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- Financial leverage MicrosoCortrepotied (MSFT) reported the following data (in millions) for a tern year Compute the profit margin, asset turnover, and financial leverage metrics using the expandedDuPont formula. Round profit margin, asset turnover, and financial leverage to two decimalplaces.Round return on stockholders’ equity to one decimal place.Sales transactions Using transactions listed in P4-2, indicate the effects of each transaction on the liquidity metric working capital and profitability metric gross profit percent. Indicate the gross profit percent for each sale (rounding to one decimal place) in parentheses next to the effect of the sale on the company’s ability to attain an overall gross profit percent of 30%.Current Asset 120 000Cash 20 000Accounts Receivable 45 000Short-term investments 12 000Merchandise Inventory 42 000Current Liabilities 68 000 What is the company's current ratio?What is the company's quick ratio?
- YZ Goods target capital structure and other data follow: Long-term debt $ 754,000,000 Preferred stock 40,000,000 Common equity 896,000,000 Total capital $1,690,000,000 Cost of Debt (kd) = 11% for amounts up to 80 M of additional Debt; will rise to 13% after that. Cost of Preferred = 10.5% at any amount T = 40%. P0 = $23. g= 8%, and it is expected to remain constant. Assume that the company expects to have total earnings of $137.8 million in 2020. Further, it has a target payout ratio of 45 percent, so it plans to pay out 45 percent of its earnings as dividends. Flotation cost of 5% is incurred for issuance of new shares. The following projects are available for investment: Project Cost (in Millions) Rate of Return A $50…Q1) Omani Industrial Company has the following data which is extracting from its financial statements at the beginning 2020. Calculate the following ratios :-( Note; -Write all Equations). Return on Equity (ROE). Total Asset Turnover (TAT). Debt Ratio. Net Profit Margin 12% Sales 2000 (OMR) Financial Leverage Multiplier 2.5 Times Return on Asset (ROA) 10 %what does the percentages mean in vertical analysis? Year 4 % of Sales Year 3 % of Sales Assets Current Assets Cash $ 40,000 6.67 $ 36,000 6.67 Marketable Securities 20000 3.33 6000 1.11 Accounts Receivable 54000 9.00 46000 8.52 Inventories 135000 22.50 143000 26.48 Prepaid Items 25000 4.17 10000 1.85 Total Assets current 274000 45.67 241000 44.63 Investments 27000 4.50 20000 3.70 plant net 270000 45.00 255000 47.22 Land 29000 4.83 24000 4.44 Total Assets $ 600,000 100.00 $ 540,000 100.00 Liabilities and Stock equity Liabilities Current Liabilities Notes payable $ 17,000 2.83 $ 6,000 1.11 Accounts payable 113800 18.97 100000 18.52 salaries payable 21000 3.50 15000 2.78 Total current liabilities 151800 25.30 121000 22.41 Noncurrent liabilities…
- 2019: Profit Margin – Profit $1435 / Net Sales $38,464 = 0.037:1 OR 3.7% Working Capital – Current Assets $3406 - Current Liabilities $4291 = -885 Current Ratio – Current Assets $3406 / Current Liabilities $4291 = 0.79:1 OR $0.79 Current Cash Debt Coverage – Net Cash Provided by Operation Activities $2275 / Average Current Liabilities $8781.50 = 0.26:1 OR 0.26 Average Current Liabilities Calculation: 4291 + 8981 / 2 = 8781.50 Debt to Total Assets Ratio – Total Liabilities 4291 + 2129 = 6420 / Total Assets 3406 + 6371 = 9777 = 0.66:1 OR 0.66 Cash Debt Coverage – Net Cash Provided by Operation Activities $2275 / Average Total Liabilities 11,067.25 = 0.21:1 OR 0.21 Average Total Liabilities Calculation: 6420 + 9295 / 2 = 11,067.25 Return on Assets – Profit 1435 / Average Total Assets 11,160.50 = 0.128:1 OR 12.8% Average Total Assets Calculation: 9777 + 12544 / 2 = 11,160.50 2020: Profit Margin – Profit $978 / Net Sales $37,784 = 0.025:1 OR 2.5% Working Capital – Current Assets $3779 -…Year 0 1 Revenue 600.00 Fixed costs 100.00 Variable costs 200.00 Additional investment in NWC 10.00 Additional investment in operating long-term assets 70.00 Depreciation 60.00 Interest expenses 35.00 Newly issued debt 25.00 Principle repayments 15.00 Tax rate 0.40 Market value of the firm: Price per share No. of shares Market value Short-term debt 100.00 Long-term debt 600.00 Preferred stock 10.00 10 100.00 Common stock, equity 18.00 100 1,800.00 Total 2,600.00 Cost of equity (Rs) 0.1500 Growth rate per year from year 1 through year 5 0.10 Growth rate after year 5 0.07 What is the price per share according to the equity free cash flow model? Select one: a. $18.29 b. $10.98 c. $15.51 d. $20.87 e. $12.33Given:Avarege trade receivables of afirm is40.000,average finished goodsis 50.000, cost of goods sold is 200000 and net sales is 250.000. Whatis trade receivables turnover? a. 250.000/40.000 b. 40.000/ 200.000 c. 40.000/250.000 d. 200.000/ 40.000 ========== 5. Activity Ratios are used in the assessment ofa) The financial risk of the companyb) the profitability of the assetsc) the short term debt repayment capacity of the firm d)the efficiency of the asset or the source analyzed
- 14- Given the following data; TOTAL SALES OMR 250000 CASH SALES OMR 125000 SALES RETURN OMR 5000 OPENING SUNDRY DEBTORS OMR 20000 CLOSING SUNDRY DEBTORS OMR 10000 What will be the Debtors Turnover Ratio (DTR)? a. 8 b. 16 c. 6 d. 5Current ratio = 2.6 timesProfit margin = 10%Sales = $1,270mROE = 10%Long-term debt to Long-term debt and equity = 60% Use the above information to complete the balance sheet below. (Enter your answers in millions.) Current assets ? million Current liabilities $280 million Fixed assets ? million Long-term debt ? million Stockholders’ equity ? million Total assets ? million Total liabilities and equity ? millionFixed assets 267.5 million Sales 1,100.0 million Net Income 52.0 million Current liabilities 106.8 million Current ratio 3.10x Days sales outstanding 41.25 days Return on equity 12.50% Compute the return on assets.