Assume the following relationships for the Caulder Corp.: Sales/Total assets Return on assets (ROA) Return on...

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Assume the following relationships for the Caulder Corp.: Sales/Total assets Return on assets (ROA) Return on equity (ROE) 13.0% Calculate Caulder's profit margin and debt-to-capital ratio assuming the firm uses only debt and common equity, so total asse capital. Do not round intermediate calculations. Round your answers to two decimal places. Profit margin: Debt-to-capital ratio: % 2.3x 5.0% 4. Problem 4.14 (Return on Equity) eBook Problem Walk-Through Pacific Packaging's ROE last year was only 5%, but its management has developed a new operating plan that calls for a debt-to-capital ratio of 50%, which will result in annual Interest charges of $441,000. The firm has no plans to use preferred stock and total assets equal total invested capital. Management projects an EBIT of $864,000 on sales of $9,000,000, and it expects to have a total assets turnover ratio of 2.3. Under these conditions, the tax rate will be 25%. If the changes are made, what will be the company's return on equity? Do not round intermediate calculations, Round your answer to two decimal places. N 5. Problem 4.15 (Return on Equity and Quick Ratio) eBook Problem Walk-Through Lloyd Inc. has sales of $550,000, a net income of $60,500, and the following balance sheet: Cash Receivables Inventories $ 73,260 Accounts payable 140,580 Notes payable to bank 425,700 Total current liabilities $639,540 Long-term debt $82,170 40,590 $122,760 172,260 Total current assets Net fixed assets Total assets 694,980 $990,000 The new owner thinks that inventories are excessive and can be lowered to the point where the current ratio is equal to the industry average, 2.5x, without affecting sales or net income. If inventories are sold and not replaced (thus reducing the current ratio to 2.5x), if the funds generated are used to reduce common equity (stock can be repurchased at book value), and if no other changes occur, by how much will the ROE change? Do not round intermediate calculations. Round your answer to two decimal places ROE will select: by percentage points. What will be the firm's new quick ratio? Do not round intermediate calculations. Round your answer to two decimal places. 350,460 Common equity $990,000 Total liabilities and equity 6. Problem 4.19 (Current Ratio) 10 eBook Problem Walk-Through The Stewart Company has $1,867,000 in current assets and $784,140 in current liabilities. Its initial inventory level is $392,070, and it will raise funds as additional notes payable and use them to increase inventory. How much can its short-term debt (notes payable) increase without pushing its current ratio below 2.0? Round your answer to the nearest dolls Assume the following relationships for the Caulder Corp.: Sales/Total assets Return on assets (ROA) Return on equity (ROE) 13.0% Calculate Caulder's profit margin and debt-to-capital ratio assuming the firm uses only debt and common equity, so total asse capital. Do not round intermediate calculations. Round your answers to two decimal places. Profit margin: Debt-to-capital ratio: % 2.3x 5.0% 4. Problem 4.14 (Return on Equity) eBook Problem Walk-Through Pacific Packaging's ROE last year was only 5%, but its management has developed a new operating plan that calls for a debt-to-capital ratio of 50%, which will result in annual Interest charges of $441,000. The firm has no plans to use preferred stock and total assets equal total invested capital. Management projects an EBIT of $864,000 on sales of $9,000,000, and it expects to have a total assets turnover ratio of 2.3. Under these conditions, the tax rate will be 25%. If the changes are made, what will be the company's return on equity? Do not round intermediate calculations, Round your answer to two decimal places. N 5. Problem 4.15 (Return on Equity and Quick Ratio) eBook Problem Walk-Through Lloyd Inc. has sales of $550,000, a net income of $60,500, and the following balance sheet: Cash Receivables Inventories $ 73,260 Accounts payable 140,580 Notes payable to bank 425,700 Total current liabilities $639,540 Long-term debt $82,170 40,590 $122,760 172,260 Total current assets Net fixed assets Total assets 694,980 $990,000 The new owner thinks that inventories are excessive and can be lowered to the point where the current ratio is equal to the industry average, 2.5x, without affecting sales or net income. If inventories are sold and not replaced (thus reducing the current ratio to 2.5x), if the funds generated are used to reduce common equity (stock can be repurchased at book value), and if no other changes occur, by how much will the ROE change? Do not round intermediate calculations. Round your answer to two decimal places ROE will select: by percentage points. What will be the firm's new quick ratio? Do not round intermediate calculations. Round your answer to two decimal places. 350,460 Common equity $990,000 Total liabilities and equity 6. Problem 4.19 (Current Ratio) 10 eBook Problem Walk-Through The Stewart Company has $1,867,000 in current assets and $784,140 in current liabilities. Its initial inventory level is $392,070, and it will raise funds as additional notes payable and use them to increase inventory. How much can its short-term debt (notes payable) increase without pushing its current ratio below 2.0? Round your answer to the nearest dolls

Answer rating: 100% (QA)

Here are the stepbystep workings Originally Current assets 1867000 Curren... View the full answer