Reference no: EM132459251
Question 1: Engines has $15 billion in total assets - of which cash and equivalents total $80 million. Its balance sheet shows $3 billion in current liabilities - of which the notes payable balance totals $1.06 billion. The firm also has $7.5 billion in long-term debt and $4.5 billion in common equity. It has 300 million shares of common stock outstanding, and its stock price is $29 per share. The firm's EBITDA totals $1.218 billion. Assume the firm's debt is priced at par, so the market value of its debt equals its book value. What are Edelman's market/book and its EV/EBITDA ratios? Do not round intermediate calculations. Round your answers to two decimal places.
Question 2: A firm has a profit margin of 2.5% and an equity multiplier of 2.5. Its sales are $330 million, and it has total assets of $132 million. What is its ROE? Do not round intermediate calculations. Round your answer to two decimal places.
Question 3: Broward Manufacturing recently reported the following information:
Net income $288,000. ROA8% Interest expense $86,400 Accounts payable and accruals $1,050,000
Broward's tax rate is 25%. Broward finances with only debt and common equity, so it has no preferred stock. 40% of its total invested capital is debt, and 60% of its total invested capital is common equity. Calculate its basic earning power (BEP), its return on equity (ROE), and its return on invested capital (ROIC). Do not round intermediate calculations. Round your answers to two decimal places.
BEP:
ROE:
ROIC:
Question 4: Thomson Trucking has $9 billion in assets, and its tax rate is 25%. Its basic earning power (BEP) ratio is 20%, and its return on assets (ROA) is 4.25%. What is its times-interest-earned (TIE) ratio? Round your answer to two decimal places.
Question 5: MPI Incorporated has $9 billion in assets, and its tax rate is 25%. Its basic earning power (BEP) ratio is 10%, and its return on assets (ROA) is 6%. What is MPI's times-interest-earned (TIE) ratio? Do not round intermediate calculations. Round your answer to two decimal places.
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: A firm has a profit margin of 2.5% and an equity multiplier of 2.5. Its sales are $330 million, and it has total assets of $132 million. What is its ROE?
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