1. (Evaluating profitability?) The Malia Corporation had sales in 2015 of $63 million, total assets of $48 million, and total liabilities of $16 million. The interest rate on the? company's debt is 6.2 percent and its tax rate is 30 percent. The operating profit margin was 11.9 percent. What were the? company's operating income and net? income? What was the operating return on assets and return on? equity? Assume that interest must be paid on all of the debt.
The operating income was
ANSWER: $ (Round to the nearest? dollar.)
The net income was
?ANSWER: $? (Round to the nearest? dollar.)
The operating return on assets was
ANSWER: $ (Round to one decimal? place.)
The return on equity was
ANSWER: (Round to one decimal? place.)
2. (Evaluating liquidity?) The Tabor Sales Company had a gross profit margin? (gross profits divided by ÷?sales) of 30.4 percent and sales of $9.6 million last year.? Seventy-five percent of the? firm's sales are on credit and the remainder are cash sales.? Tabor's current assets equal ?$2.5 million, its current liabilities equal $287,000 and it has $99,000 in cash plus marketable securities.
a. If? Tabor's accounts receivable are $562,500. what is its average collection? period? ANSWER: (Round to two decimal? places.)
b. If Tabor reduces its average collection period to 20 days, what will be its new level of accounts? receivable? ANSWER: ?(Round to the nearest? dollar.)
c. ?Tabor's inventory turnover ratio is 9.3 times. What is the level of? Tabor's inventories? ANSWER: (Round to the nearest? dollar.)
?3. (Economic value added?) Drew Concrete uses Economic Value Added as a financial performance measure. Drew has $230 million in? assets, and the firm has financed its assets with 45?% equity and 55% debt with an interest rate of 99?%. The? firm's opportunity cost on its funds is 13?%, while the operating return on the? firm's assets is 16%.
a. What is the Economic Value Added created or destroyed by Drew? Concrete?
b. What does Economic Value Added? measure?
a. What is the Economic Value Added? (EVA) created or destroyed by Drew? Concrete? Enter a positive number for EVA created or a negative number for EVA destroyed. ANSWER: million ?(Round to one decimal? place.)