The most recent financial statements for Cardinal, Incorporated, are shown here: Income Statement Sales Costs Taxable income Taxes (24%) $ 23,700 Assets 17,400 $ 6,300 1,512 Total Balance Sheet $ 106,000 $ 106,000 Debt Equity Total $32,600 73,400 $ 106,000
The most recent financial statements for Cardinal, Incorporated, are shown here: Income Statement Sales Costs Taxable income Taxes (24%) $ 23,700 Assets 17,400 $ 6,300 1,512 Total Balance Sheet $ 106,000 $ 106,000 Debt Equity Total $32,600 73,400 $ 106,000
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Financial Ratios
A Ratio refers to a figure calculated as a reference to the relationship of two or more numbers and can be expressed as a fraction, proportion, percentage, or the number of times. When the number is determined by taking two accounting numbers derived from the financial statements, it is termed as the accounting ratio.
Return on Equity
The Return on Equity (RoE) is a measure of the profitability of a business concerning the funds by its stockholders/shareholders. ROE is a metric used generally to determine how well the company utilizes its funds provided by the equity shareholders.
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Transcribed Image Text:The most recent financial statements for Cardinal, Incorporated, are shown here:
Income Statement
Sales
Costs
Taxable
income
Taxes (24%)
Net income
$ 23,700 Assets
17,400
$ 6,300
1,512
$4,788
What is the external financing needed?
Multiple Choice
O
O
$183,892
Assets and costs are proportional to sales. Debt and equity are not. A dividend of $1,490
was paid, and the company wishes to maintain a constant payout ratio. Next year's sales
are projected to be $28,600.
$17,936
Total
$12,436
$13,536
Balance Sheet
$
106,000
$
106,000
Debt $32,600
Equity
73,400
$
106,000
Total
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