Question: please help with the following questions: 1.) The following information is available about Marne Company for 2010. All sales are on credit. Average cash and

please help with the following questions:

1.) The following information is available about Marne Company for 2010. All sales are on credit.

Average cash and marketable securities = $1 million

EBIT = $2 million

Average inventory = $5 million

COGS = $15 million

Average accounts payable = $3 million

Long-term bonds = $8 million

Average accounts receivable = $3 million

Coupon rate on bonds = 10%

Total Sales = $20 million

Find its

(A) Inventory turnover ratio

(B) Number of days sales outstanding

(C) Interest coverage ratio

(D) Current ratio

(E) Quick ratio

2.) Go to the Internet and find the following ratios for McDonald Corporation (MCD). Give the source of your information.

Ratio

Formula

Calculation

Ratio

Liquidity

Current

total current assets / total current liabilities

Quick, or Acid Test

(current assets - inventories) / current liabilities

Asset Management

Inventory Turnover

cost of goods sold / Inventories (average)

Days sales outstanding

Receivables / Sales per day

Fixed assets turnover

Annual sales / Net Fixed assets (average)

Total assets turnover

Annual sales / total assets (average)

Debt Management

Debt ratio

total debt / total assets

Interest coverage

EBIT / Interest charges

Profitability

Net profit margin

net income / total operating revenue

Net return on assets

net income / total average assets

Return on common equity

net income to stockholders / average common equity

Dividend payout ratio

total cash dividends / net income

Market Value

P-E ratio

(Market Price/share) / (Earnings/share)

Market/Book

(Market Price/Share) / (Book Value/Share)

Dividend yield

Dividend per share / Market Price per share

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