Attempts: Score: 17 18. Problem 4.23 Ratio Analysis Data for Barry Computer Co.
ID: 2600892 • Letter: A
Question
Attempts: Score: 17 18. Problem 4.23 Ratio Analysis Data for Barry Computer Co. and its industry averages follow. Barry Computer Company: Balance Sheet as of December 31, 2014 (In Thousands) Cash Receivables Inventories $195,520 481,280 315,840 $992,640 Accounts payable Other current liabilities Notes payable $210,560 195,520 150,400 $556,480 Total current assets Total current liabilities Long-term debt Common equity Total liabilities and equity $315,840 631,680 $1,504,000 Net fixed assets 511,360 Total assets $1,504,000 Barry Computer Company: Income Statement for Year Ended December 31,2014 (In Thousands) Sales $2,350,000Explanation / Answer
3. Days sales outstanding = Accounts receivable / Total credit sales
= 481280/ 2350000*365
= 74.75 days
4. Total Assets turnover = Total sales / net assets
= 2350000 / 1504000
= 1.5625
5. Inventory turnover = cost of goods sold / average inventory
= 1997500/315840
= 6.324405
6. Profit Margin = EBIT/ TOtal sales
= 141000 / 2350000
= 6%
it can be net prodit margin = net profit / sales
= 71335/2350000
= 3.04%
7. ROA = Net profit /Total Assets
= 141000 / 1504000
= 9.38%
8. ROIC (Return on invested capital) = net income / invested capital(long term debt + equity)
= 71335 / (315840+631680)
= 71335 / 947520
= 11.29%
9. TIE(Time interest earned) = EBIT / Interest
= 141000/22109
= 6.377
10. Debt total capital = Debt(long term debt + short term debt)/ total capital
= (556480 + 315840) / 1504000
= 872320 / 1504000
= 58%
DU pont equation = net profit/sales * sales /total assets* assets/equity
=so from formula only variable are left = net profit / equity
= 71335/631680
= 11.29%
c. option (v)
d. option (iv) looks meaning full from the question perspective.
Note - due to average values not known, have taken individual year values.
Please note all values are in $.
In case of any clarification required please comment.
Current ratio = current ratio / current liabilities Total current assets = 992640 Total current libilities = 556480 current ratio = 992640/556480 1.783784 Quick Ratio = Quick assets / current libilities quick assets = 676800 (current assets less inventory) 1.216216Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.