CashReceivablesInventoriesTotal CANet fixed assetsTotal assetsSalesNet income280211470280364126490% (use 2 decimals)Accounts payableOther current liabilitiesTotal CLLong-term debtCommon equityTotal liab. and equity422870140280420AYou have the above balance sheet and income statement for Ahmed's inc.You want to reduce your inventory to generate funds to buy back common stock at the book value. You will reduce inventory so that the current ratio is equal to 2.09.There is no effect on sales or net income. What is the new ROE?

Current Ratio = Current Assets / Current LiabilitiesReturn on Equity = Net Income / Common Equity

Cash Receivables Inventories Total CA Net fixed assets Total assets Sales Net income 280 21 14 70 280 364 126 490 % (use 2 decimals) Accounts payable Other current liabilities Total CL Long-term debt Common equity Total liab. and equity 42 28 70 140 280 420 You have the above balance sheet and income statement for Ahmed's inc. You want to reduce your inventory to generate funds to buy back common stock at the book value. You will reduce inventory so that the current ratio is equal to 2.09 There is no effect on sales or net income. What is the new ROE?

Cash Receivables Inventories Total CA Net fixed assets Total assets Sales Net income 280 21 14 70 280 364 126 490 % (use 2 decimals) Accounts payable Other current liabilities Total CL Long-term debt Common equity Total liab. and equity 42 28 70 140 280 420 You have the above balance sheet and income statement for Ahmed's inc. You want to reduce your inventory to generate funds to buy back common stock at the book value. You will reduce inventory so that the current ratio is equal to 2.09 There is no effect on sales or net income. What is the new ROE?

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter4: The Balance Sheet And The Statement Of Shareholders' Equity

Section: Chapter Questions

Problem 16P: Ratios Analyses: McCormick Refer to the information for McCormick above. Additional information for...

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