week 3 H-380-3-Homework

Problem 2-5A

The following are financial statements of Bramble Corp..

Net sales		$2,231,500
Cost of goods sold		1,027,800
Selling and administrative expenses		918,600
Interest expense		90,600
Income tax expense		70,170
Net income		$ 124,330

Assets
Current assets
Cash		$ 73,100
Debt investments		85,170
Accounts receivable (net)		189,700
Inventory		164,200
Total current assets		512,170
Plant assets (net)		590,700
Total assets		$ 1,102,870
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable		$ 173,000
Income taxes payable		36,670
Total current liabilities		209,670
Bonds payable		219,900
Total liabilities		429,570
Stockholders’ equity
Common stock		365,400
Retained earnings		307,900
Total stockholders’ equity		673,300
Total liabilities and stockholders’ equity		$1,102,870

Additional information: The net cash provided by operating activities for 2017 was $203,800. The cash used for capital expenditures was $107,400. The cash used for dividends was $32,170. The weighted-average number of shares outstanding during the year was 50,000.

(a)	Compute the following values and ratios for 2017. (We provide the results from 2016 for comparative purposes.) (Round Current Ratio and Earnings per share to 2 decimal places, e.g. 15.25 and Debt to assets ratio to 1 decimal place, e.g. 78.9%. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

(i)		Working capital. (2016: $160,500)
(ii)		Current ratio. (2016: 1.65:1)
(iii)		Free cash flow. (2016: $48,700)
(iv)		Debt to assets ratio. (2016: 31%)
(v)		Earnings per share. (2016: $3.15)

(i)	Working capital	$
(ii)	Current ratio		:1
(iii)	Free cash flow	$
(iv)	Debt to assets ratio		%
(v)	Earnings per share	$

Exercise 6-12

The following information is available for Pharoah Company for three recent fiscal years.

	2017	2016	2015
Inventory	$552,440	$569,374	$337,484
Net sales	1,955,006	1,692,420	1,322,224
Cost of goods sold	1,532,544	1,277,699	936,594

Calculate the inventory turnover, days in inventory, and gross profit rate for 2017 and 2016. (Round inventory turnover to 1 decimal place, e.g. 5.2, days in inventory to 0 decimal places, e.g. 125 and gross profit rate to 1 decimal place, e.g. 5.2%.)

	2017		2016
Inventory Turnover		times		times
Days in Inventory		days		days
Gross Profit Rate		%		%

Exercise 8-14 (Part Level Submission)

Suppose the following information was taken from the 2017 financial statements of FedEx Corporation, a major global transportation/delivery company.

(in millions)	2017	2016
Accounts receivable (gross)	$ 3,408	$ 4,611
Accounts receivable (net)	3,144	4,284
Allowance for doubtful accounts	264	327
Sales revenue	32,081	35,794
Total current assets	6,739	6,864

Calculate the accounts receivable turnover and the average collection period for 2017 for FedEx Corporation. (Round answers to 1 decimal place, e.g. 12.5. Use 365 days for calculation.)

Accounts receivable turnover			times
The average collection period for 2017			days

(b)

	Your answer is correct.

Is accounts receivable a material component of the company’s total current assets?

Exercise 9-17

Crane Company reports the following information (in millions) during a recent year: net sales, $10,185.0; net earnings, $250.0; total assets, ending, $5,130.0; and total assets, beginning, $5,150.0.

(a) Calculate the (1) return on assets, (2) asset turnover, and (3) profit margin. (Round answers to 1 decimal place, e.g. 6.2% and 6.2.)

1.	Return on assets	%
2.	Asset turnover	times
3.	Profit margin	%

1 decimal place, e.g. 78.9%. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)(i) Working capital. (2016: $160,500)(ii) Current ratio. (2016: 1.65:1)(iii) Free cash flow. (2016: $48,700)(iv) Debt to assets ratio. (2016: 31%)(v) Earnings per share. (2016: $3.15)(i) Working capital $ (ii) Current ratio :1(iii) Free cash flow $ (iv) Debt to assets ratio %(v) Earnings per share $ Exercise 6-12The following information is available for Pharoah Company for three recent fiscal years. 2017 2016 2015Inventory $552,440 $569,374 $337,484Net sales 1,955,006 1,692,420 1,322,224Cost of goods sold 1,532,544 1,277,699 936,594Calculate the inventory turnover, days in inventory, and gross profit rate for 2017 and 2016. (Round inventory turnover to 1 decimal place, e.g. 5.2, days in inventory to 0 decimal places, e.g. 125 and gross profit rate to 1 decimal place, e.g. 5.2%.) 2017 2016Inventory Turnover times timesDays in Inventory days daysGross Profit Rate % %Exercise 8-14 (Part Level Submission)Suppose the following information was taken from the 2017 financial statements of FedEx Corporation, a major global transportation/delivery company.(in millions) 2017 2016Accounts receivable (gross) $ 3,408 $ 4,611Accounts receivable (net) 3,144 4,284Allowance for doubtful accounts 264 327Sales revenue 32,081 35,794Total current assets 6,739 6,864Calculate the accounts receivable turnover and the average collection period for 2017 for FedEx Corporation. (Round answers to 1 decimal place, e.g. 12.5. Use 365 days for calculation.)Accounts receivable turnover timesThe average collection period for 2017 days(b) Your answer is

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