Financial and Managerial Accounting - With CengageNow
14th Edition
ISBN: 9781337577809
Author: WARREN
Publisher: CENGAGE L
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Question
Chapter 1, Problem 4ADM
a)
To determine
Ratio of liabilities to
To Compute: The ratio of liabilities to stockholders' equity of Company PJ and Company YB.
b)
To determine
To derive: A conclusion regarding the margin of protection to the creditors from the ratio of liabilities to stockholders' equity of Company PJ and Company YB.
c)
To determine
A more risky company among Company PJ and Company YB.
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Selected financial data for DC Menswear is provided as follows:
($ in millions except share data)
Sales
$14,826
Net income
$1,190
Stockholders’ equity, beginning
$3,800
Stockholders’ equity, ending
$4,200
Average shares outstanding (in millions)
$620
Dividends per share
$1.20
Stock price, ending
$23.13
Required:
Calculate the following ratios for DC Menswear. (Enter "Net income" and "Average stockholders' equity" answers in millions (i.e., 5,000,000 should be entered as 5). Round your answers to 2 decimal places.)
DC Menswear
Return on Equity
÷
=
Return on equity
Dividend Yield
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Price-Earnings Ratio
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Here is a simplified balance sheet for Caterpillar Tractor:
Caterpillar Tractor
Balance Sheet
($ in millions)
Current
liabilities
46,838 Long-term debt
Current assets $42,527
Long-term
assets
Total
$89,365 Total
Market value
Market value
added
Other liabilities
Equity
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a. Calculate the company's market value added. (Enter your answers in millions.)
Market-to-book ratio
Yes
O No
GA
$
GA
$29,752
27,755
14,323
17,535
$89,365
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million
million
c. Has the company created value for shareholders?
There are two companies (Heart and Apt). Here is financial data from the past year. All dollar amounts for sales, total assets and net income are in millions. The risk free rate (UST securities) = 4%.
Heart Apts
Sales $ 9,350 $ 8,930
Net Income $ 902 $ 1,460
ROA 8.8% 7.6%
ROE 30.2% 13.96%
Current ratio 1.88x 2.17x
Shares outstanding 238m 219m
Beta 2.58 0.98
Stock price $18.79/sh. $159.00/sh.
P/E…
Chapter 1 Solutions
Financial and Managerial Accounting - With CengageNow
Ch. 1 - Name some users of accounting information.Ch. 1 - Prob. 2DQCh. 1 - Prob. 3DQCh. 1 - Prob. 4DQCh. 1 - On July 12, Reliable Repair Service extended an...Ch. 1 - Prob. 6DQCh. 1 - Describe the difference between an account...Ch. 1 - A business had revenues of 679,000 and operating...Ch. 1 - Prob. 9DQCh. 1 - The financial statements are interrelated. What...
Ch. 1 - Prob. 1.1BECh. 1 - Prob. 1.2BECh. 1 - Transactions Interstate Delivery Service is owned...Ch. 1 - Income statement The revenues and expenses of...Ch. 1 - Prob. 1.5BECh. 1 - Balance sheet Using the following data for...Ch. 1 - Statement of cash flows A summary of cash flows...Ch. 1 - Types of businesses The following is a list of...Ch. 1 - Prob. 1.2EXCh. 1 - Prob. 1.3EXCh. 1 - Accounting equation The total assets and total...Ch. 1 - Prob. 1.5EXCh. 1 - Accounting equation Determine the missing amount...Ch. 1 - Prob. 1.7EXCh. 1 - Asset, liability, and stockholders equity items...Ch. 1 - Effect of transactions on accounting equation What...Ch. 1 - Effect of transactions on accounting equation A. A...Ch. 1 - Effect of transactions on stockholders equity...Ch. 1 - Transactions The following selected transactions...Ch. 1 - Nature of transactions Teri West operates her own...Ch. 1 - Net income and dividends The income statement for...Ch. 1 - Net income and stockholders equity for four...Ch. 1 - Balance sheet items From the following list of...Ch. 1 - Income statement items From the following list of...Ch. 1 - Prob. 1.18EXCh. 1 - Income statement Imaging Services was organized on...Ch. 1 - Missing amounts from balance sheet and income...Ch. 1 - Balance sheets, net income Financial information...Ch. 1 - Financial statements Each of the following items...Ch. 1 - Statement of cash flows Indicate whether each of...Ch. 1 - Statement of cash flows A summary of cash flows...Ch. 1 - Financial statements We-Sell Realty, organized as...Ch. 1 - Transactions On September 1 of the current year,...Ch. 1 - Financial statements The amounts of the assets and...Ch. 1 - Financial statements Seth Feye established...Ch. 1 - Transactions; financial statements On August 1,...Ch. 1 - Transactions; financial statements DLite Dry...Ch. 1 - Missing amounts from financial statements The...Ch. 1 - Transactions Amy Austin established an insurance...Ch. 1 - Financial statements The amounts of the assets and...Ch. 1 - Financial statements Jose Loder established Bronco...Ch. 1 - Prob. 1.4BPRCh. 1 - Transactions; financial statements Bevs Dry...Ch. 1 - Missing amount from financial statements The...Ch. 1 - Peyton Smith enjoys listening to all types of...Ch. 1 - Prob. 1ADMCh. 1 - Home Depot: Ratio of liabilities to stockholders'...Ch. 1 - Lowes: Ratio of liabilities to stockholders equity...Ch. 1 - Prob. 4ADMCh. 1 - Ethics in Action Marco Brolo is one of three...Ch. 1 - Prob. 1.3TIF
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