A firm has a debt to asset ratio of 75%, $213,000 in debt, and net income of $40

Question

A firm has a debt to asset ratio of 75%, $213,000 in debt, and net income of $40,470. Calculate return on equity. (Do not round intermediate calculations.)

75%

57%

77%

73%

ABC Co. has an average collection period of 40 days. Total credit sales for the year were $5,000,000. What is the balance in accounts receivable at year-end? (Use 360 days in a year. Do not round intermediate calculations. Round your answer to the nearest dollar amount.)

$565,556

$2,000,000

$5,000,000

$555,556

XYZ's receivables turnover is 25x. The accounts receivable at year-end are $580,000. The average collection period is 90 days. What was the sales figure for the year assuming all sales are on credit?

$580,000

$14,500,000

$123,200

$23,200

A firm's long term assets = $70,000, total assets = $360,000, inventory = $18,000 and current liabilities = $30,000. (Round your answers to 1 decimal place.)

current ratio = 9.7; quick ratio = 9.1

current ratio = 14.7; quick ratio = 14.1

current ratio = 12.2; quick ratio = 11.6

current ratio = 19.7; quick ratio = 19.1

A firm has total assets of $2,050,000. It has $903,000 in long-term debt. The stockholders equity is $703,000. What is the debt to total asset ratio? (Round your answer to the nearest whole percent.)

76%

81%

66%

None of the items

Explanation / Answer

1 Debt /Asset 75% Debt =          213,000 Asset =213000/0.75          284,000 Equity =Asset-Debt=            71,000 Net Income            40,470 ROI =40470/71000 57% 2 Avearge collection period                    40 days Debtors turnover =360/40=                       9 Credit sales      5,000,000 Accounts Receivable=Credit sales/Debor TO          555,556 3 Receivable TO                    25 Accounts receivable=          580,000 Credit sales    14,500,000 4 Total assets          360,000 Long term assets            70,000 a Current Asset          290,000 b Inventory            18,000 c Current liability            30,000 Current Ratio =a/c=                   9.7 Quick Ratio=(a-b)/c=                   9.1 1st option correct 5 a Total Asset      2,050,000 b Equity          703,000 c Long term debt          903,000 d short term debt          444,000 e Total debt      1,347,000 f Debt to Total asset=e/a= 66%

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