Which company is reinvesting the highest percentage

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Reference no: EM132642711

Financial Information

                                      Company A             Company B          Company C

Total Assets           $18,709,000               $22,568,000        $20,876,000

Total Liabilities      $ 5, 453,000               $ 6,345,000          $ 8,900,000

Current Assets       $ 9,775,000               $,10,250,000          $12,325,000

Current Liabilities    $ 3,195,000               $4,975,000            $6,525,000

Asset Coverage       $ 2,509                        $ 2,987             $ 1,675

Inventory               $ 3,150,000              $ 5,995,000              $ 4,975,000

Inventory Turnover          8.5X                       7.1X                     5.8X

Cash Flow/Total Debt          38%                     40%                  30%

Debt/Equity                        41.6%              54.5%            48.1%

Dividend Per Share             $2.50                $3.25                $1.75

EPS                                  $5.75                  $6.00              $4.00

Gross Profit Margin               8.9%                  11.4%               10.0%

Interest Coverage                  3.3X                   4.4X               5.2X

Net Return on Invested Capital        5%                 9%               8%

Number of Shares Outstanding      4,225,000             3,550,000            6,750,000

Problem 1. Which company is reinvesting the highest percentage of its net earnings in its business?

Option 1: Ratio

Option 2: Company A

Option 3: Company B

Option 4: Company C

Reference no: EM132642711

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