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15 January, 11:33

Sales $ 1,000,000 Net income $ 45,000 Current Assets $ 50,000 Fixed Assets $ 200,000 Total Assets $ 250,000 Current Liabilities $ 30,000 Long-Term Liabilities $ 100,000 Total Liabilities $ 130,000 Current stock price $ 28 Number of Shares Outstanding40000 Use the above info to determine the ratios. Use two decimals and enter percents as percent

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  1. 15 January, 11:43
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    Profit Margin = income / sales

    45,000 / 1,000,000 = 4.5%

    Return on Assets = income / assets

    45,000 / 250,000 = 18%

    Assets turnover = sales / assets

    1,000,000 / 250,000 = 4

    Earning per share: income / shares outstanding

    45,000 / 40,000 = 1.125

    Price - Earning ratio = market price / EPS

    28 / 1.125 = 24,89

    Return on Equity = income / equity*

    45,000 / 120,000 = 37.5%

    Debt to Equity ratio liab / equity

    130,000 / 120,000 = 1,08

    Explanation:

    *solving for equity

    Assets = laib + equity

    250,000 = 130,000 + equity

    equity = 120,000
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