Using the income statement for Times Mirror and Glass Co., compute the following ratios:

TIMES MIRROR AND GLASS COMPANY
Sales $ 266,000
Cost of goods sold 161,000
Gross profit $ 105,000
Selling and administrative expense 46,400
Lease expense 13,300
Operating profit* $ 45,300
Interest expense 7,300
Earnings before taxes $ 38,000
Taxes (30%) 15,200
Earnings after taxes $ 22,800
*Equals income before interest and taxes.
a. Compute the interest coverage ratio. (Round your answer to 2 decimal places.)
b. Compute the fixed charge coverage ratio. (Round your answer to 2 decimal places.)
The total assets for this company equal $172,000. Set up the equation for the Du Pont system of ratio analysis.
c. Compute the profit margin ratio. (Input your answer as a percent rounded to 2 decimal places.)
d. Compute the total asset turnover ratio. (Round your answer to 2 decimal places.)
e. Compute the return on assets (investment). (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.)

Question

05-09-2020
Business

contestada

Using the income statement for Times Mirror and Glass Co., compute the following ratios:

TIMES MIRROR AND GLASS COMPANY
Sales $ 266,000
Cost of goods sold 161,000
Gross profit $ 105,000
Selling and administrative expense 46,400
Lease expense 13,300
Operating profit* $ 45,300
Interest expense 7,300
Earnings before taxes $ 38,000
Taxes (30%) 15,200
Earnings after taxes $ 22,800
*Equals income before interest and taxes.
a. Compute the interest coverage ratio. (Round your answer to 2 decimal places.)
b. Compute the fixed charge coverage ratio. (Round your answer to 2 decimal places.)
The total assets for this company equal $172,000. Set up the equation for the Du Pont system of ratio analysis.
c. Compute the profit margin ratio. (Input your answer as a percent rounded to 2 decimal places.)
d. Compute the total asset turnover ratio. (Round your answer to 2 decimal places.)
e. Compute the return on assets (investment). (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.)

Respuesta :

Otras preguntas

Aaron Plumbing and Bautista Electrical have both made bids in 50 of the same projects over the years. Aaron was selected for 20 of those projects. Bautista was

On April 1 of year 0 Stephanie received a $9,000 payment for full payment on a three-year service contract (under the contract Stephanie is obligated to provide

Assume that given , middle and family are three variables of type string that have been assigned values . Write an expression whose value is a string consisting

What are the three different kinds of population density and what is the difference between them?

Find the z-score such that the area under the standard normal curve to the left is 0.79.| is the Z-score such that the area under the curve to the left is 0.79

How was Greek religion communicated to the people?

The conversion of glucose-6-phosphate to fructose-6-phosphate is catalyzed by an isomerase enzyme. Glucose-6-phosphate was mixed with the enzyme under standard

The pores that present in the plasma membrane acts on....... A) the transfer of DNA molecules into the cytoplasm to synthetesize the protiensB) the transfer of

PLEASE ANSWER ASAP!!!!! Rectangle ABCD is dilated to create rectangle A'B'C'D' . The width of rectangle ABCD is 12 feet. The width of rectangle A'B'C'D' is 8 fe

Why did the first inhabitants of mainland Southeast Asia settle in the plains and river valleys?A. Those areas were easy to defendB. Those areas were good for f

Ritmeks Ritmeks · Answer 1 · 2020-09-05T04:51:27+02:00

Answer:

(A) Interest coverage charge ratio= 6.21

(B) Fixed charge coverage = 2.84

(C) Profit margin ratio= 8.57%

(D) Total assets turnover= 1.55

(E) Return on assets= 13.26%

Explanation:

(A) The Interest coverage charge ratio can be calculated as follows= EBIT/Interest expense

= 45,300/7,300

= 6.21

(B) The fixed charge coverage can be calculated as follows

= income before fixed charge + interest/fixed charges + interest

= 45,300+13,300/7,300+13,300

= 58,600/20,600

= 2.84

(C) The profit margin ratio can be calculated as follows

= Net income/sales × 100

= 22,800/266,000 × 100

=0.0857 × 100

= 8.57%

(D) The total assets turnover can be calculated as follows

= Sales/total assets

= 266,000/172,000

= 1.55

(E) The return on assets can be calculated as follows

= Net income/Total assets × 100

= 22,800/172,000 × 100

= 0.13255×100

= 13.26%

surbhibuttan surbhibuttan · Answer 2 · 2022-02-04T13:23:43+01:00

The income statement for Times Mirror and Glass Co., compute the following ratios is :

Answer (A)

The Interest coverage charge ratio can be calculated as follows

Interest coverage charge ratio= EBIT/Interest expense
Interest coverage charge ratio= 45,300/7,300
Interest coverage charge ratio= 6.21

Answer (B)

The fixed charge coverage can be calculated as follows

fixed charge coverage = income before fixed charge + interest/fixed charges + interest
fixed charge coverage = 45,300+13,300/7,300+13,300
fixed charge coverage = 58,600/20,600
fixed charge coverage = 2.84

Answer (C)

The profit margin ratio can be calculated as follows

profit margin ratio= Net income/sales × 100
profit margin ratio= 22,800/266,000 × 100
profit margin ratio=0.0857 × 100
profit margin ratio= 8.57%

Answer (D)

The total assets turnover can be calculated as follows

total assets turnover = Sales/total assets
total assets turnover = 266,000/172,000
total assets turnover = 1.55

Answer(E)

The return on assets can be calculated as follows

return on assets= Net income/Total assets × 100
return on assets= 22,800/172,000 × 100
return on assets= 0.13255×100
return on assets= 13.26%

Learn more :

https://brainly.com/question/22433256referrer=searchResults