Question 1.
A company had a market price of $38.10 per share, earnings per share of $1.55, and dividends per share of $0.70. Calculate its price-earnings ratio:
a) 27.8
b) 30.6
c) 24.6
d) 26.6
e) 23.0
Question 2:
Refer to the given selected financial information from Fennie's, LLC. Evaluate the company's working capital for Year 2.
Year 2 Year 1
Cash $ 38,400 $ 33,150
Short-term investments 99,000 64,500
Accounts receivable, net 90,000 84,000
Merchandise inventory 125,500 129,500
Prepaid expenses 13,000 10,600
Plant assets 392,500 342,500
Accounts payable 108,900 112,300
Net sales 715,500 680,500
Cost of goods sold 394,500 379,500
a) $158,000.
b) $131,500.
c) $244,000.
d) $257,000.
e) $167,000.
Question 3.
Refer to the given selected financial information from Fennie's, LLC. Evaluate the company's acid-test ratio for Year 2.
Year 2 Year 1
Cash $ 39,500 $ 34,250
Short-term investments 110,000 70,000
Accounts receivable, net 95,500 89,500
Merchandise inventory 131,000 135,000
Prepaid expenses 14,100 11,700
Plant assets 398,000 348,000
Accounts payable 103,400 117,800
Net sales 721,000 686,000
Cost of goods sold 400,000 385,000
a) 2.71.
b) 3.64.
c) 2.51.
d) 2.37.
e) 3.77.
Question 4.
Refer to the given selected financial information from Fennie's, LLC. Evaluate the company's accounts receivable turnover for Year 2.
Year 2 Year 1
Cash $ 39,300 $34,050
Short-term investments 108,000 69,000
Accounts receivable, net 94,500 88,500
Merchandise inventory 130,000 134,000
Prepaid expenses 13,900 11,500
Plant assets 397,000 347,000
Accounts payable 104,400 116,800
Net sales 720,000 685,000
Cost of goods sold 399,000 384,000
a) 5.54 times
b) 8.14 times
c) 7.87 times
d) 6.67 times
e) 7.62 times
Question 5.
Refer to the following given financial information from Fennie's, LLC. Evaluate the company's inventory turnover for Year 2.
Year 2 Year 1
Cash $ 39,400 $ 34,150
Short-term investments 109,000 69,500
Accounts receivable, net 95,000 89,000
Merchandise inventory 130,500 134,500
Prepaid expenses 14,000 11,600
Plant assets 397,500 347,500
Accounts payable 103,900 117,300
Net sales 720,500 685,500
Cost of goods sold 399,500 384,500
a) 2.97.
b) 3.61.
c) 5.52.
d) 3.06.
e) 3.02.
Question 6.
Refer to the given selected financial information from Hansen's, LLC. Evaluate the company's profit margin for Year 2.
Year 2 Year 1
Net sales $ 483,000 $ 427,150
Cost of goods sold 277,200 251,020
Interest expense 10,600 11,600
Net income before tax 68,150 53,580
Net income after tax 46,950 40,800
Total assets 318,900 293,400
Total liabilities 176,900 168,200
Total equity 142,000 125,200
a) 16.9%.
b) 11.9%.
c) 9.7%.
d) 14.1%.
e) 33.1%.
Question 7.
Refer to the given selected financial information from Hansen's, LLC. Evaluate the company's return on total assets for Year 2.
Year 2 Year 1
Net sales $ 483,000 $ 427,150
Cost of goods sold 277,200 251,020
Interest expense 10,600 11,600
Net income before tax 68,150 53,580
Net income after tax 46,950 40,800
Total assets 318,900 293,400
Total liabilities 176,900 168,200
Total equity 142,000 125,200
a) 22.3%.
b) 14.7%.
c) 2.7%.
d) 9.7%.
e) 15.3%.