1 Rio Imports Information from the financial statements are provided below: Refe

Question

1

Rio Imports

Information from the financial statements are provided below:

Refer to Rio Imports. The times interest earned ratio for 2015

d. Decreased, which indicates that the company has less cash to pay interest on its debt.

2.

Rio Imports

Information from the financial statements are provided below:

Refer to Rio Imports. The net profit margin percentage for 2015 is:

d. 16.00%

3.

Rainsoft Company

Selected data from the financial statements are provided below:

Refer to Rainsoft Company. What is the current ratio for 2015?

4.

Rainsoft Company

Selected data from the financial statements are provided below:

Refer to Rainsoft Company. What is the operating cash flow ratio for 2015?

d. 0.072

5.

Rio Imports

Information from the financial statements are provided below:

Refer to Rio Imports. The dividend payout ratio for 2015 is:

Rio Imports

Information from the financial statements are provided below:

2015 2014 Current Liabilities $460,000 $320,000 Long-Term Liabilities 240,000 640,000 Stockholders' Equity 840,000 1,080,000 Net Cash Flows from Operating Activities 160,000 102,000 Interest and Principal Payments 24,000 16,000 Net Sales 950,000 900,000 Net Income 180,000 144,000 Interest Expense 17,000 23,000 Income Taxes 32,000 29,000 Dividends Paid to Common Stockholders 30,000 60,000

Explanation / Answer

Ans) RIO IMPORTS Year 2015 Net sales $        950,000.00 Net Income $        180,000.00 Interest Expense $           17,000.00 Income Taxes $           32,000.00 Net Income after tax $        131,000.00 1(b) Times Interest Earned Ratio = EBIT/Interest Expense Times Interest Earned Ratio = 10.59 2(a) Net Profit Margin Percentage= Net Profit/Sales Net Profit Margin Percentage= 0.1895 18.95 % 3(b) Rain Soft Company Year 2015 Total Current Assets $        218,000.00 Total Current Liabilities $        130,000.00 Current Ratio=Total Current Assets/Total Current Liabilities Current Ratio= 1.68 4(d) Net Credit Sales $        442,000.00 Net Cash Flow from operating Activity $           32,000.00 Operating Cash Flow Ratio=Net Cash flow from operating activity/Net Credit Sales 0.072 5(c ) Stockholder's Equity $        840,000.00 Dividend paid to common stockholders $           30,000.00 Net Income $        180,000.00 Dividnd Payout Ratio=Dividend/Net Income 0.167 16.7 %

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