Question: I need help finding the EBITDA ratio. I am supposed to calculate the ratio with the provided information given from the Balance sheet and Income

I need help finding the EBITDA ratio. I am supposed to calculate the ratio with the provided information given from the Balance sheet and Income statement as well as the additional information from Problem 2 (At the end of 2014, the firm had 100 shares of common stock outstanding and the stock price was $18 per share.). I cannot find the ratio because I'm confused about which numbers to use in order to first find the enterprise value. Thank you.

Hermetic, Inc., Balance Sheet (as of December 31)

Assets 2013 2014

Current assets

Cash $ 45 $ 50

Accounts receivable 270 290

Inventory 320 365

Total $ 635 $ 705

Fixed assets

Net plant and equipment 985 1100

Total assets $1620 $1805

Liabilities and equity 2002 2003

Current liabilities

Accounts payable $ 210 $ 260

Notes payable 110 175

Total $ 320 $ 435

Long-term debt 215 185

Stockholders equity

Common stock and paid-in surplus 290 290

Retained earnings 795 895

Total $1085 $1185

Total liabilities and equity $1620 $1805

Income Statement (2014)

Net sales $710.00

Cost of goods sold 480.00

Depreciation 30.00

Earnings before interest and taxes (EBIT) $200.00

Interest 20.00

Taxable income 180.00

Taxes 53.45

Net income $126.55

Retained earnings $100.00

Dividends 26.55

d) At the end of 2014, the firm had 100 shares of common stock outstanding and the stock price was $18 per share. Calculate the EBITDA ratio.

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