Quiz 1 for corporate finance

Question 1 12.5 ptsWhich ratio below would give the best sense of the overall efficiency of the firm? Fixed Asset TurnoverTotal Asset Turnover (TATO)Total Debt to Total AssetsCurrent RatioInventory TurnoverQuestion 2 12.5 ptsIf the return on assets for a firm is 14.5% and the firm is financed with 50% debt and 50% equity, what is the return on equity?7.25%not enough information29.0%19.5%Question 3 12.5 pts If the “debt to equity” ratio is 2.2, what is the “debt to assets” ratio?No answer text provided. 0.6875 2.2 3.2Question 4 12.5 ptsFrom Problem 2.15:

Cash  47,250

Short term investments 3,800

Accounts Receivable 283,500

Inventories 141,750

Total Current Assets 476,300

Total Assets  807,500

What is the common size number for Inventories?

14.175not enough information17.5680.71Question 5 12.5 ptsIf inventories grew from 135,000 to 141,750 over the 2009 to 2010 years, what was the percentage increase in inventories?1.05%not enough information105%5.0%Question 6 12.5 pts

What is the Days Sales Outstanding for a firm with the following information (assume 365 day year):

Sales: 900

COGS: 500

Depreciation:  100

Interest:  50

Inventory:  100

Accounts Receivable:  150

2.47 days60.83 days40.56 daysNot enough information0.167 daysQuestion 7 12.5 pts

What is inventory turnover for a firm with the following information.  Use the formula with COGS instead of Sales:

Sales: 900

COGS: 500

Depreciation:  100

Interest:  50

Inventory:  100

Accounts Receivable:  150

3564Question 8 12.5 ptsWhat are the three “levers” for Return on Equity?  That is, what three ratios can be used to calculate return on equity?profit margin, total asset turnover and equity multiplierprofit margin, debt ratio and return on assetsinventory turnover, debt to equity and leverageprofitability, efficiency and market value ratios

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