Thank you
1. Vigo Vacations has an equity multiplier of 2.9. Thecompany’s assets are financed with some combination of long-term debt andcommon equity. What is the company’s debt ratio? Round your answer to twodecimal places.
%
Currentand Quick Ratio
2.Ace Industries has current assets equal to $4 million. The company’s currentratio is 2.5, and its quick ratio is 2.0.
What is the firm’s level of current liabilities? $ million
What is the firm’s level of inventories? $ million
3. BalanceSheet Analysis
Completethe balance sheet and sales information in the table that follows forHoffmeister Industries using the following financial data
Debtratio: 55% Quick ratio: 0.95 Total assets turnover: 2.8Days sales outstanding: 31 days* Gross profit margin on sales: (Sales – Cost of goods sold)/Sales = 26% Inventory turnover ratio: 5.0* Calculation is based on a 365-day year.
Roundyour answers to the nearest whole dollar.
BalanceSheet
Cash
$
Accounts payable
$
Accounts receivable
$
Long-term debt
$ 60,000
Inventories
$
Common stock
$
Fixed assets
$
Retained earnings
$ 97,500
Total assets
$ 300,000
Total liabilities and equity
$
Sales
$
Cost of goods sold
$
4. PersonalAfter-Tax Yield
Corporatebonds issued by Johnson Corporation currently yield 8.5%. Municipal bonds ofequal risk currently yield 6.5%. At what tax rate would an investor beindifferent between these two bonds? Round your answer to two decimal places.
%
5. Incomestatement
LittleBooks Inc. recently reported $3 million of net income. Its EBIT was $6.5million, and its tax rate was 40%. What was its interest expense? (Hint:Write out the headings for an income statement and then fill in the knownvalues. Then divide $3 million net income by (1 – T) = 0.6 to find the pre-taxincome. The difference between EBIT and taxable income must be the interest expense.Use this same procedure to work some of the other problems.) Round your answerto the nearest whole dollar and enter your answer as a dollar amount.$
6. NetCash Flow
KendallCorners Inc. recently reported net income of $2.1 million and depreciation of$357,000. What was its net cash flow? Assume it had no amortization expense.
$
8.Corporate After-Tax Yield
TheShrieves Corporation has $10,000 that it plans to invest in marketablesecurities. It is choosing among AT