CONTEMP.FINANCIAL MGMT. (LL)-W/MINDTAP
14th Edition
ISBN: 9780357292877
Author: MOYER
Publisher: CENGAGE L
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Question
Chapter 3, Problem 18P
a)
Summary Introduction
To determine: Earnings per share.
a)
Expert Solution
Explanation of Solution
Calculation of EPS:
Hence, Earnings per share (EPS) is $4.20
b)
Summary Introduction
To determine: Price-to-earnings ratio.
b)
Expert Solution
Explanation of Solution
Calculation of price-to-earnings ratio:
Hence, price earnings ratio is $7.6.
c)
Summary Introduction
To determine: Book value per share.
c)
Expert Solution
Explanation of Solution
Calculation of book value per share:
Hence, book value per share is $16
d)
Summary Introduction
To determine: Market-to-book ratio.
d)
Expert Solution
Explanation of Solution
Calculation of market-to-book ratio:
Hence, book value per share is $16
e)
Summary Introduction
To determine: EV-EBITDA multiple.
e)
Expert Solution
Explanation of Solution
Calculation of EV-EBITDA multiple:
EV is nothing but the enterprise value
Calculation of enterprise value:
Hence, enterprise value is $230 million
Calculation of EBITDA:
Hence, EBITDA is $50 million
Calculation of EV-EBITDA multiple:
Hence, EV-EBITDA multiple is 4.6 times
f)
Summary Introduction
To determine: Addition to
f)
Expert Solution
Explanation of Solution
Calculation of additions to retained earnings:
Hence, additions to retained earnings are $11million.
g)
Summary Introduction
To construct: New balance sheet of Company E.
g)
Expert Solution
Explanation of Solution
Excel spreadsheet:
Excel workings:
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Students have asked these similar questions
Given the following information for the Vanderbilt Tire Company, find ROA (Return on Assets): Debt ratio (D/A) = 0.33 (expressed as a decimal) Total asset turnover ratio (S/A) = 1.88 Sales (S) = $10,000 Net profit margin = 0.08 (expressed as a decimal)
Required:
(a) You are required to calculate the following ratios:(i) Gross profit margin(ii) Operating profit margin(iii) Expenses to sales(iv) Return on Capital Employed(v) Asset turnover(vi) Non-current asset turnover(vii) Current Ratio(viii) Quick Ratio(ix) Inventory days(x) Receivables days(xi) Payable days(xii) Interest cover
(b) In light of your calculations comment on the performance of the company over thelast two years.
The balance sheet and income statement for the J. P.
Robard Mfg. Company are as follows:
Calculate the following ratios: Current ratio
Times interest earned
Inventory turnover
Total asset turnover
Operating profit margin
Operating return on assets
Debt ratio
Average collection period
Fixed asset turnover
Return on equity
J. P. Robard Mfg., Inc. Balance Sheet ($000)
Cash $550
Accounts receivable 2,100
Inventories 1,060
Current assets $3,710
Net fixed assets 4,520
Total assets $8,230
Accounts payable $1,200
Accrued expenses 610
Short-term notes payable 280
Current liabilities $2,090
Long-term debt 2,000
Owners' equity 4,140
Total liabilities and owners' equity $8,230
J. P. Robard Mfg., Inc. Income Statement ($000)
Net sales (all credit) $7,940
Cost of goods sold 3,310
Gross Profit $4,630
Operating expenses (includes $500 depreciation) 3,050
Net operating income $1,580
Interest expense 368
Earnings before taxes $1,212
Income taxes (40%) 485
Net income $727
Chapter 3 Solutions
CONTEMP.FINANCIAL MGMT. (LL)-W/MINDTAP
Ch. 3 - Prob. 1QTDCh. 3 - Prob. 2QTDCh. 3 - Prob. 3QTDCh. 3 - Prob. 4QTDCh. 3 - Prob. 5QTDCh. 3 - Prob. 6QTDCh. 3 - Prob. 7QTDCh. 3 - Prob. 8QTDCh. 3 - Prob. 9QTDCh. 3 - Prob. 10QTD
Ch. 3 - Prob. 11QTDCh. 3 - Prob. 12QTDCh. 3 - Prob. 13QTDCh. 3 - Prob. 14QTDCh. 3 - Prob. 1PCh. 3 - Prob. 2PCh. 3 - Prob. 3PCh. 3 - Prob. 4PCh. 3 - Prob. 5PCh. 3 - Prob. 6PCh. 3 - Prob. 7PCh. 3 - Prob. 8PCh. 3 - Prob. 9PCh. 3 - Prob. 10PCh. 3 - Prob. 11PCh. 3 - Prob. 12PCh. 3 - Prob. 13PCh. 3 - Prob. 14PCh. 3 - Prob. 15PCh. 3 - Prob. 16PCh. 3 - Prob. 17PCh. 3 - Prob. 18PCh. 3 - Prob. 19PCh. 3 - Prob. 20PCh. 3 - Prob. 21P
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