Fundamentals of Corporate Finance 3e Test Bank
52.
If Viera, Inc., has an accounts receivable turnover of 3.9 times and net sales of $3,436,812,
what is its level of receivables? Round your final answer to the nearest dollar.
A)
$881,234
B)
$13,403,567
C)
$1,340,357
D)
$81,234
Ans:
A
Fundamentals of Corporate Finance 3e Test Bank
53.
Gateway Corp. has an inventory turnover ratio of 5.6. What is its day’s sales in inventory?
Round your final answer to nearest day.
A)
65 days
B)
64 days
C)
61 days
D)
57 days
Ans:
A
Fundamentals of Corporate Finance 3e Test Bank
54.
Jet, Inc., has net sales of $712,478 and accounts receivable of $167,435. What are the firm’s
accounts receivable turnover and day’s sales outstanding? Round your accounts receivable
turnover to two decimal places and day’s sales outstanding to nearest day.
A)
0.24 times; 79 days
B)
4.26 times; 86 days
C)
5.2 times; 61 days
D)
None of the above.
Ans:
B
Fundamentals of Corporate Finance 3e Test Bank
55.
Ellicott City Manufacturers, Inc., has sales of $6,344,210, and a gross profit margin of 67.3
percent. What is the firm’s cost of goods sold? Round your final answer to the nearest dollar.
A)
$2,074,557
B)
$2,745,640
C)
$274,560
D)
None of the above.
Ans:
A
Fundamentals of Corporate Finance 3e Test Bank
56.
Deutsche Bearings has total sales of $9,745,923, inventories of $2,237,435, cash and
equivalents of $755,071, and day’s sales outstanding of 49 days. If the firm’s management
wanted its day’s sales outstanding (DSO) to be 35 days, by how much will the accounts
receivable have to change? Round your final answer to two decimal places.
A)
$373,816.23
B)
−$373,816.23
C)
−$379,008.12
D)
$379,008.12
Ans:
B
Fundamentals of Corporate Finance 3e Test Bank
57.
Trident Corp., has debt of $3.35 million with an interest rate of 6.875 percent. The company
has an EBIT of $2,766,009. What is its times-interest-earned ratio? Round your final answer to
nearest number.
A)
13 times
B)
12 times
C)
11 times
D)
None of the above
Ans:
B
Fundamentals of Corporate Finance 3e Test Bank
58.
Sectors, Inc., has an EBIT of $7,221,643 and interest expense of $611,800. Its depreciation for
the year is $1,434,500. What is its cash coverage ratio? Round your final answer to two decimal
places.
A)
15.42 times
B)
18.34 times
C)
14.15 times
D)
None of the above
Ans:
C
Fundamentals of Corporate Finance 3e Test Bank
59.
Fahr Company had depreciation expenses of $630,715, interest expenses of $112,078, and an
EBIT of $1,542,833 for the year ended June 30, 2006. What are the times interest earned and
cash coverage ratios for this company? Round your final answers to one decimal place.
A)
19.4 times; 12.7 times
B)
17.3 time; 11.4 times
C)
13.8 times; 19.4 times
D)
None of the above
Ans:
C
Fundamentals of Corporate Finance 3e Test Bank
60.
Your firm has an equity multiplier of 2.47. What is its debt-to-equity ratio? Round your final
answer to two decimal places.
A)
0.60
B)
1.47
C)
1.74
D)
3.47
Ans:
B
61.
What will be a firm’s equity multiplier given a debt ratio of 0.45? Round your final answer to
two decimal places.
A)
1.82
B)
1.28
C)
2.22
D)
None of the above
Ans:
A
Fundamentals of Corporate Finance 3e Test Bank
62.
Dreisen Traders has total debt of $1,233,837 and total assets of $2,178,990. What are the firm’s
equity multiplier and debt-to-equity ratio? Round your final answers to two decimal places.
A)
2.31; 1.31
B)
1.75; 0.75
C)
0.75; 1.75
D)
1.31; 2.31
Ans:
A
63.
RTR Corp. has reported a net income of $812,425 for the year. The company’s share price is
$13.45, and the company has 312,490 shares outstanding. Compute the firm’s price-earnings
ratio. Round your final answer to two decimal places.
A)
4.87 times
B)
8.12 times
C)
5.17 times
D)
None of the above
Ans:
C
Fundamentals of Corporate Finance 3e Test Bank
64.
Perez Electronics Corp. has reported that its net income for 2006 is $1,276,351. The firm has
420,000 shares outstanding and a PE ratio of 11.2 times. What is the firm’s share price?
Round your intermediate and final answer to two decimal places.
A)
$34.05
B)
$3.68
C)
$11.20
D)
$36.80
Ans:
A
Fundamentals of Corporate Finance 3e Test Bank
65.
Juventus Corp has total assets of $4,744,288, total debt of $2,912,000, and net sales of
$7,212,465. Their net profit margin for the year is 18 percent. What is Juventus’s return on
assets (ROA)? Round intermediate calculations to nearest dollar and percentage answer to one
decimal place.
A)
25.6%
B)
18%
C)
27.4%
D)
None of the above
Ans:
C