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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

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