# Question

Calculate the profit margin for 2014 and evaluate the result against the industry average in Exhibit, explaining why it compares favorably or unfavourably (round to two decimal places).

Current ratio........................................................... 1.6:1

Acid-test ratio .......................................................... 1.1:1

Accounts receivable turnover .................................. 16 times

Days’ sales uncollected............................................ 21 days

Merchandise turnover ............................................. 5 times

Days’ sales in inventory ........................................... 70 days

Total asset turnover ................................................. 2.3 times

Accounts payable turnover...................................... 4 times

Debt ratio ............................................................... 35%

Equity ratio ............................................................. 65%

Pledged assets to secured liabilities.......................... 1.4:1

Times interest earned .............................................. 50 times

Profit margin........................................................... 14%

Gross profit ratio..................................................... 18%

Return on total assets .............................................. 20%

Return on common shareholders’ equity................. 32.7%

Book value per common share................................ $8.63

Book value per preferred share................................ $15.00

Earnings per share ................................................... $1.79

Price–earnings per share .......................................... 18.2

Dividend yield ......................................................... $0.35

Current ratio........................................................... 1.6:1

Acid-test ratio .......................................................... 1.1:1

Accounts receivable turnover .................................. 16 times

Days’ sales uncollected............................................ 21 days

Merchandise turnover ............................................. 5 times

Days’ sales in inventory ........................................... 70 days

Total asset turnover ................................................. 2.3 times

Accounts payable turnover...................................... 4 times

Debt ratio ............................................................... 35%

Equity ratio ............................................................. 65%

Pledged assets to secured liabilities.......................... 1.4:1

Times interest earned .............................................. 50 times

Profit margin........................................................... 14%

Gross profit ratio..................................................... 18%

Return on total assets .............................................. 20%

Return on common shareholders’ equity................. 32.7%

Book value per common share................................ $8.63

Book value per preferred share................................ $15.00

Earnings per share ................................................... $1.79

Price–earnings per share .......................................... 18.2

Dividend yield ......................................................... $0.35

## Answer to relevant Questions

Calculate the gross profit ratio for 2014 and evaluate the result against the industry average in Exhibit, explaining why it compares favorably or unfavourably (round to two decimal places).Current ...ABC Inc.’s common shares have a market value of $60 per share and its EPS is $3.50. XYZ Inc.’s common shares have a market value of $85 per share and its EPS is $4.10. You have done thorough research and are considering ...a. Calculate the merchandise inventory turnover for 2014 for each company (round to two decimal places).b. Can you compare these companies? Explain.c. Review the turnover for Freshcut Flowers Inc. Does this result appear to ...Required Using the information provided, calculate book value per common share assuming:a. There are no dividends in arrears.b. There are three years of dividends inarrears.Marsulex Inc. began the month of March with $750,000 of current assets, a current ratio of 2.5 to 1, and an acid-test ratio of 1.1 to 1. During the month, it completed the following transactions:Required Prepare a schedule ...Post your question

0