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FIN500 Week Two Homework Assignment

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Question;Notes:Work should be done individually.Word-process your solutions;within this template and show all steps used in arriving at the final answers.;Incomplete solutions will receive partial credit. Copy and paste all necessary data;and create tables as needed.;1.;Suppose a company;has \$350,000 in current assets. The company?s current ratio is 1.25. Compute;the company?s current liabilities.;2.;What is the market price;of a share of stock for a firm that pays dividends of \$1.20 per share, has a;price-earnings ratio (P/E) of 14, and a dividend payout ratio of 0.4?;3.;A;firm's price to earnings ratio (P/E) is 8 and its market to book ratio is 2. If;its earnings per share are \$4.00, what is the book value per share?;4.;Assume a company;had a profit margin of 5.25%, a total assets turnover of 1.5, and an equity;multiplier of 1.8. What was the firm's;ROE?;5.;Suppose a company;had sales last year of \$415,000, and its year-end total assets were \$355,000. The;average firm in the industry has a total assets turnover ratio (TATO) of;2.4. Bonner's new CFO believes the firm;has excess assets that can be sold so as to bring the TATO down to the industry;average without affecting sales. By how;much must the assets be reduced to bring the TATO to the industry average;holding sales constant?

Paper#45208 | Written in 18-Jul-2015

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