Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Textbook Question
Chapter 14, Problem 2CP
Which of the following best explains a ratio of “net sales to average net fixed assets” that exceeds the industry average?
a. The firm added to its plant and equipment in the past few Years.
b. The firm makes less efficient use of its assets than other firms.
c. The firm has a lot of old plant and equipment.
d. The firm uses straight-line depreciation.
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The ABC Corporation has a profit margin on sales below the industry average, yet its ROA is above the industry average. What does this imply about its asset turnover?
13.
Which of the following statements is true?
a.The tangible capital asset turnover ratio assists managers in determining the estimated future capital expenditures that are needed.
b.The average age of the tangible capital assets is computed by dividing accumulated depreciation by depreciation expense.
c.If net sales increases, the tangible capital asset turnover ratio will decrease.
d.A relatively low tangible capital asset turnover ratio signals that a company is efficiently using its assets.
Western Gas & Electric Co. (WG&E) had sales of $1,550,000 last year on fixed assets of $270,000. Given that WG&E’s fixed assets were being used at only 94% of capacity, then the firm’s fixed asset turnover ratio was?
How much sales could Western Gas & Electric Co. (WG&E) have supported with its current level of fixed assets?
When you consider that WG&E’s fixed assets were being underused, what should be the firm’s target fixed assets to sales ratio?
Suppose WG&E is forecasting sales growth of 22% for this year. If existing and new fixed assets are used at 100% capacity, the firm’s expected fixed assets turnover ratio for this year is?
Chapter 14 Solutions
Essentials Of Investments
Ch. 14 - Prob. 1PSCh. 14 - Prob. 2PSCh. 14 - The Crusty Pie Co., which specializes in apple...Ch. 14 - The ABC Corporation has a profit margin on sales...Ch. 14 - A company’s current ratio is 2. If the company...Ch. 14 - Cash flow from investing activities excludes:...Ch. 14 - Cash flow from operating activities includes:...Ch. 14 - Prob. 8PSCh. 14 - Prob. 9PSCh. 14 - Prob. 10PS
Ch. 14 - Prob. 11PSCh. 14 - Use the DuPont system and the following data to...Ch. 14 - A firm has an ROE of 3 , a debt/equity ratio of...Ch. 14 - A firm has a tax burden ratio of 0.75 , a leverage...Ch. 14 - A11 analyst gathers the following information...Ch. 14 - Here are data On two Firms: LO142 Equity ($...Ch. 14 - Prob. 1CPCh. 14 - Which of the following best explains a ratio of...Ch. 14 - Use the Financial statements for Chicago...Ch. 14 - Prob. 4CPCh. 14 - The information in the following table comes from...Ch. 14 - Scott Kelly is reviewing Master Toy’s financial...Ch. 14 - The DuPont formula defines the net return on...Ch. 14 - Go to finance.yahoo.com to find information about...Ch. 14 - Answer the following questions for these two toy...Ch. 14 - Prob. 3WM
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