Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN: 9781337395083
Author: Eugene F. Brigham, Phillip R. Daves
Publisher: Cengage Learning
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Chapter 7, Problem 14P
Summary Introduction
To determine: The company J’s
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The Jimenez Corporation’s forecasted 2020 financial statements follow, along with some industry average ratios. Calculate Jimenez’s 2020 forecasted ratios, compare them with the industry average data, and comment briefly on Jimenez’s projected strengths and weaknesses.Jimenez Corporation:
Forecasted Balance Sheet as of December 31, 2020
Assets
Cash
72,000
Accounts receivable
439,000
Inventories
894,000
Total current assets
1,405,000
Fixed assets
431,000
Total assets
1,836,000
Liabilities and Equity
Accounts payable
332000
Notes payable
100,000
Accruals
170,000
Total current liabilities
602,000
Long-term debt
404,290
Common stock
575,000
Retained earnings
254,710
Total liabilities and equity
1,836,000
Jimenez Corporation: Forecasted Income Statement for 2020
Sales
4,290,000
Cost of goods sold
3,580,000
Selling, general, and admin expenses
525,456
Earnings before taxes (EBT)
184,544
Interest expense
40,000
Earnings…
Toby’s forecasted 2021 financial statements follow, along with some industry average ratios. Calculate Toby’s 2021 forecasted ratios and fill in the above table. Calculate the EPS and DPS. The company has a 40% payout ratio.
Bartleby, can you please calculate 2019 ROI and 2019 ROE, based on the following information. Presented here are summarized data from the balance sheets and income statements of Wiper Inc.:
WIPER INC.
Condensed Balance Sheets
December 31, 2020, 2019, 2018
(in millions)
2020
2019
2018
Current assets
$
650
$
900
$
700
Other assets
2,750
2,050
1,750
Total assets
$
3,400
$
2,950
$
2,450
Current liabilities
$
500
$
800
$
700
Long-term liabilities
1,500
1,000
800
Stockholders' equity
1,400
1,150
950
Total liabilities and stockholders' equity
$
3,400
$
2,950
$
2,450
WIPER INC.
Selected Income Statement and Other Data
For the year Ended December 31, 2020 and 2019
(in millions)
2020
2019
Income statement data:
Sales
$
3,300
$
2,900
Operating income
380
300
Interest expense
80
70
Net income
300
230
Other data:
Average…
Chapter 7 Solutions
Intermediate Financial Management (MindTap Course List)
Ch. 7 - Define each of the following terms:
Liquidity...Ch. 7 - Financial ratio analysis is conducted by managers,...Ch. 7 - Prob. 3QCh. 7 - Profit margins and turnover ratios vary from one...Ch. 7 - How might (a) seasonal factors and (b) different...Ch. 7 - Why is it sometimes misleading to compare a...Ch. 7 - Greene Sisters has a DSO of 20 days. The companys...Ch. 7 - Vigo Vacations has $200 million in total assets,...Ch. 7 - Winston Watch’s stock price is $75 per share....Ch. 7 - Reno Revolvere has an EPS of $1.50, a cash flow...
Ch. 7 - Needham Pharmaceuticals has a profit margin of 3%...Ch. 7 - Prob. 6PCh. 7 - Ace Industries has current assets equal to 3...Ch. 7 - The Morrit Corporation has $600,000 of debt...Ch. 7 - The Kretovich Company had a quick ratio of 1.4, a...Ch. 7 - Data for Lozano Chip Company and its industry...Ch. 7 - Prob. 14PCh. 7 - Why are ratios useful? What three groups use ratio...Ch. 7 - Prob. 2MCCh. 7 - Calculate the 2019 inventory turnover, days sales...Ch. 7 - Calculate the 2019 debt ratio,...Ch. 7 - Prob. 5MCCh. 7 - Prob. 8MCCh. 7 - Prob. 9MCCh. 7 - What are some qualitative factors that analysts...
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- The Jimenez Corporation’s forecasted 2020 financial statements follow, along with some industry average ratios. Calculate Jimenez’s 2020 forecasted ratios, compare them with the industry average data, and comment briefly on Jimenez’s projected strengths and weaknesses. Jimenez Corporation: Forecasted Balance Sheet as of December 31, 2020 Jimenez Corporation: Forecasted Income Statement for 2020 Jimenez Corporation: Per Share Data for 2020 Notes: aIndustry average ratios have been stable for the past 4 years. bBased on year-end balance sheet figures. cCalculation is based on a 365-day year.arrow_forwardCalculate the 2019 debt ratio, liabilities-to-assets ratio, times-interest-earned ratio, and EBITDA coverage ratios. How does Computron compare with the industry with respect to financial leverage? What can you conclude from these ratios?arrow_forwardRatio Analysis Consider the following information taken from the stockholders equity section: How do you interpret the companys payout and profitability performance? Required: 1. Calculate the following for 2020. (Note. Round answers to two decimal places.) 2. CONCEPTUAL CONNECTION Assume 2019 ratios were: and the current year industry averages are: How do you interpret the companys payout and profitability performance?arrow_forward
- Using average value, calculate TWO (2) relevant financial ratios for each of the following areas that are useful in determining the overall performance of the company for 2019 and 2018. Ability to meet short term maturing financial obligations. Effectiveness in managing assets and efficiency in handling operations Profitability and overall operating results Ability to service debt and the degree of financial risk ROE using the DuPont Methodarrow_forwardUsing the attached balanced sheet and income statement Calculate the following ratios for the respective years: 2019, 2020, 2021 est Liquidity Ratios Current Ratio (times) Quick Ratio (times) Asset Management Ratios Average sales/day Inventory Turnover Ratio (times) Days Sales Outstanding (days) Fixed Assets Turnover Ratio (times) Total Asset Turnover Ratio Debt Management Ratios Total Debt to Total Assets (%) Times Interest Earned (times) Debt to Equity Ratio (%) Profitability Ratios Profit Margin on Sales (%) Earning Power (%) Return on Total Assets (%) Return on Common Equity (%) Market Value Ratios Price/Earnings Ratio Price/Earnings Ratio (times) Price/Cash Flow Ratio (times) Market /Book Value Ratio (times) Comment on the liquidity, profitability, leverage, asset management and market valuearrow_forwardPerform the common sizing analysis for 2019 and 2018. Comment on your observations on the changes in the percentages. Focus on a) the change in the amount of total assets --- does this mean the firm is doing better? Why or why not? b) the changes in current assets, current liabilities and what this could mean for the firm. c) the changes in debt: what has increased more, total current liabilities or long-term debt? d) the change in total common equity. What has driven the change? e) the conundrum that although sales have nearly doubled, the firm makes a loss in 2019. What has caused this situation?arrow_forward
- Using the financiaql statements of Top Glove Corporation Berhad for the year 2020, provide and comment on the following: Calculate the profitability, liquidity and effiency ratios of the Top Glove Corporation Berhad company (use the following ratios: gross profit margin, net profit margin, return on capital employed, quick ratio, current ratio, accounts receivable turnover, accounts payables turnover, inventory turnover) for the year 2019 and 2020.arrow_forwardBelow is the overal Performance of Warmart for 2020. make an overall analysis on how it performed describing the ratios used and their interpretations. put in suggestions on how the performance could be improved. You should create a reason for undertaking the analysis, for example assessing an investment opportunity, acquisition or are you a potential customer.arrow_forwardPlease use the attached images as well... Compute the following: For fiscal 2019 and 2020: Current Ratio, Quick Ratio, Long Term Debt Ratio For fiscal 2019 and 2020: Gross Profit Margin, Net Profit Margin, EBITDA For fiscal 2019 and 2020: Return on Assets, Return on Equity, Return on Sales For fiscal 2020: Free Cash Flow to Equity Market Capitalization, Market to Book Value and the Price-Earnings Ratio as of year-end 2020 Stock Prices in 2018 = $68.98 2019 = $84.15 2020 = $107.82arrow_forward
- Calculate the following ratios for 2020 for Holiday Gifts Galore, Inc.: Industry avergage Average Collection Period: 35 days Debt ratio: 60% Return on Equity: 10.5% Current Ratio: 1.3 Inventory Turnover: 8.1 TImes interest earned: 2.5 Net Profit Margin: 3.78% Return on total assets: 4.36% Based on the ratios you have calculated above, does Holiday Gifts Galore, Inc. appear to be…arrow_forwardPerform the common sizing analysis for 2019 and 2018. Comment on your observations on the changes in the percentages. e) the conundrum that although sales have nearly doubled, the firm makes a loss in 2019. What has caused this situation?arrow_forwardThe image uploaded is the calculation of Societe Generale Profitability ratios, shorter liquidity ratios, long-term liquidity ratios, and investment ratios for 2020, 2021, 2022. A base year of 2019 was also added. Evaluate the financial performance by comparing the three (3) years' financial performance that is 2020, 2021, and 2022 I have provided in the table with the base year.arrow_forward
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