Kaye’s Kitchenware has a market/book ratio equal to 1. Its stock price is $12 per share and it has 4.8 million shares outstanding. The firm’s total capital is$110 million and it finances with only debt and common equity. What is its debt-to-capital ratio?

Hampton Industries had $39,000 in cash at year-end 2015 and$11,000 in cash at year-end 2016. The firm invested in property, plant, and equipment totaling $210,000. Cash flow from financing activities totaled$120,000. a. What was the cash flow from operating activities? b. If accruals increased by $15,000, receivables and inventories increased by$50,000, and depreciation and amortization totaled $25,000, what was the firm’s net income?

Electronics World Inc. paid out $22.4 million in total common dividends and reported$144.7 million of retained earnings at year-end. The prior year’s retained earnings were $95.5 million. What was the net income? Assume that all dividends declared were actually paid.

In its most recent financial statements, Nessler Inc. reported $75 million of net income and$825 million of retained earnings. The previous retained earnings were $784 million. How much in dividends were paid to shareholders during the year? Assume that all dividends declared were actually paid.

Byron Books Inc. recently reported $13 million of net income. Its EBIT was$20.8 million, and its tax rate was 35%. What was its interest expense? (Hint: Write out the headings for an income statement, and fill in the known values. Then divide $13 million of net income by (1-T)=0.65 to find the pretax income. The difference between EBIT and taxable income must be interest expense. Use this same procedure to complete similar problems.)

You are given the following information: Stockholders’ equity as reported on the firm’s balance sheet =$6.5 billion, price earnings ratio =9, common shares outstanding =180 million, and market/book ratio =2.0. Calculate the prie of a share of the company's common stock.

Harper Industries has $900 million of common equity on its balance sheet; its stock price is$80 per share; and its market value added (MVA) is $50 million. How many common shares are currently outstanding?

Edelman Engines has $17 billion in total assets. Its balance sheet shows$1.7 billion in current liabilities, $10.2 billion in long-term debt, and$5.1 billion in common equity. It has 300 million shares of common stock outstanding, and its stock price is $20 per share. What is Edelman’s market/book ratio?

Patterson Brothers recently reported an EBITDA of $7.5 million and net income of$2.1 million. It had $2.0 million of interest expense, and its corporate tax rate was 30%. What was its charge for depreciation and amortization?

A firm has been experiencing low profitability in recent years. Perform an analysis of the firm’s financial position using the DuPont equation. The firm has no lease payments but has a $2 million sinking fund payment on its debt. The most recent industry average ratios and the firm’s financial statements are as follows:$ $$ \begin{matrix} \text{Industry Average Ratios}\\ \text{Current ratio} & \text{3 }{\times} & \text{Fixed assets turnover} & \text{6 }{\times}\\ \text{Debt-to-capital ratio} & \text{20\\%} & \text{Total assets turnover} & \text{3 }{\3 times}\\ \text{Times interest earned} & \text{7 }{\times} & \text{Profit margin} & \text{3\\%}\\ \text{EBITDA coverage} & \text{9 }{\times} & \text{Return on total assets} & \text{9\\%}\\ \text{Inventory turnover} & \text{10}{\times} & \text{Return on common equity} & \text{12.86\\%}\\ \text{Days sales outstanding} & \text{24 days} & \text{Return on invested capital} & \text{11.50\\%}\\ \end{matrix} $$ $$ $\begin{matrix} \text{Balance Sheet as of December 31, 2016 (millions of Dollars)}\\ \text{Cash and equivalents} & \text{\$ 78} & \text{Accounts payable} & \text{\$ 45}\\ \text{Accounts receivable} & \text{66} & \text{Other current liabilities} & \text{11}\\ \text{Inventories} & \text{159} & \text{Notes payable} & \text{29}\\ \text{Total current assets} & \text{\$ 303} & \text{Total current liabilities} & \text{\$ 85}\\ \text{ } & \text{ } & \text{Long-term debt} & \text{50}\\ \text{ } & \text{ } & \text{Total liabilities} & \text{\$ 135}\\ \text{Gross fixed assets} & \text{225} & \text{Common stock} & \text{114}\\ \text{Less depreciation} & \text{78} & \text{Retained earnings} & \text{201}\\ \text{Net fixed assets} & \text{\$ 147} & \text{Total stockholders' equity} & \text{\$ 315}\\ \text{Total assets} & \text{\$ 450} & \text{Total liabilities and equity} & \text{\$ 450}\\ \end{matrix} $$ $$ \begin{matrix} \text{Income Statements for Year Ended December 31, 2016 (millions of dollars)}\\ \text{Net sales} & \text{\$ 795.0}\\ \text{Cost of goods sold} & \text{660.0}\\ \text{Gross profit} & \text{\$ 135.0}\\ \text{Selling expenses} & \text{73.5}\\ \text{EBITDA} & \text{\$ 61.5}\\ \text{Depreciation expense} & \text{12.0}\\ \text{Earnings before interest and taxes (EBIT)} & \text{\$ 49.5}\\ \text{Interest expense} & \text{4.5}\\ \text{Earnings before taxes (EBT)} & \text{\$ 45.0}\\ \text{Taxes (40\\%)} & \text{18.0}\\ \text{Net income} & \text{\$ 27.0}\\ \end{matrix} $$ a. Calculate the ratios you think would be useful in this analysis. b. Construct a DuPont equation, and compare the company’s ratios to the industry average ratios. c. Do the balance sheet accounts or the income statement figures seem to be primarily responsible for the low profits? d. Which specific accounts seem to be most out of line relative to other firms in the industry? e. If the firm had a pronounced seasonal sales pattern or if it grew rapidly during the year, how might that affect the validity of your ratio analysis? How might you correct for such potential problems?

Thomson Trucking has $16 billion in assets, and its tax rate is 40%. Its basic earning power (BEP) ratio is 10%, and its return on assets (ROA) is 5%. What is its times-interest-earned (TIE) ratio?

Baker Industries’s net income is $24,000, its interest expense is$5,000, and its tax rate is 40%. Its notes payable equals $27,000, long-term debt equals$75,000, and common equity equals $250,000. The firm finances with only debt and common equity, so it has no preferred stock. What are the firm’s ROE and ROIC?

The W.C. Pruett Corp. has $600,000 of interest-bearing debt outstanding, and it pays an annual interest rate of 7%. In addition, it has$600,000 of common stock on its balance sheet. It finances with only debt and common equity, so it has no preferred stock. Its annual sales are $2.7 million, its average tax rate is 35%, and its profit margin is 7%. What are its TIE ratio and its return on invested capital (ROIC)?

Barton Industries has operating income for the year of $3,500,000 and a 36% tax rate. Its total invested capital is$20,000,000 and its after-tax percentage cost of capital is 8%. What is the firm’s EVA?