California Pizza Kitchen opened its first restaurant In Beverly Hills in 1985. A

Question

California Pizza Kitchen opened its first restaurant In Beverly Hills in 1985. Almost immediately after the first location opened, it expanded from California to more than 250 locations in more than 30 states and 11 countries. California Pizza Kitchen completed an initial public offering in August 2000 and traded on the NASDAQ National Market under the ticker symbol CPKI. On July 7, 2011, Golden Gate Capital completed the acquisition of California Pizza Kitchen and, as a result of the acquisition, the company’s common stock is no longer publicly traded.

Compute the following ratios using information from the company annual report that was issued before California Pizza Kitchen was acquired. (Round your answers to 2 decimal places. Enter percentage answers rounded to 2 decimal places (i.e. 0.1234 should be entered as 12.34). Negative amounts should be indicated by a minus sign.)

California Pizza Kitchen opened its first restaurant In Beverly Hills in 1985. Almost immediately after the first location opened, it expanded from California to more than 250 locations in more than 30 states and 11 countries. California Pizza Kitchen completed an initial public offering in August 2000 and traded on the NASDAQ National Market under the ticker symbol CPKI. On July 7, 2011, Golden Gate Capital completed the acquisition of California Pizza Kitchen and, as a result of the acquisition, the company’s common stock is no longer publicly traded.

Explanation / Answer

a. Current ratio = Current Assets / Current Liabilities = 49625 / 93151 = .53

b. Quick Ratio = (Current Assets - Inventory) / Current Liabilities = (49625 - 5827) / 93151 = .47

c. Profit Margin = Net Profit / Sales * 100 = (406) / 630636 = (.064) (Net Loss margin)

d. Return on Equity = Net Income / Equity * 100 = (406) / 194411 * 100 = (.209%)

e. Inventory turnover = Sales / Average Inventory = 630636 / (5557 + 5827)/2 = 110.79

f. Debt to equity = Debt / Equity = 0 (Since there is no long term debt)

g. Earnings per share = Net Income / Number of shares = (406) / 24195800 = $(.000017) (Loss)

Therefore EPS is 0

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