Calculate the above items 5·??? ????? ?? ?? ??? ?? ???. Windswept, Inc. 2011 Inc

Question

Calculate the above items

5·??? ????? ?? ?? ??? ?? ???. Windswept, Inc. 2011 Income Statement (S in milions) Net sales Less: Cost of goods sold Less: Depreciation Earnings before interest and taxes Less: Interest paid Taxable Incomne Less: Taxes Net income $8,450 7,240 400 810 70 S 740 S 481 Windswept, Inc 2010 and 2011 Balance Sheets (S in mlions) 2010 2011 S 120 S 140 780 1480-1520 $2,530 $2,440 Net fixed assets 3.1503,600 $5,680 S6,040 2010 2011 $1,110 S1,120 840 1,210 3,200 3,000 530-710 Cash Accounts rec. Inventory Accounts payable Long-term debt Common stock Retained earnings 930 Total Total assets Total liabilities & equity $5,680 $6,040 2011 equity multiplier (Internal Growth Rate retention ratio ROA ROE Sustainable Growth Rate

Explanation / Answer

Answer for 2011:-

(1) Equity Multiplier:-

Equity Multiplier = Total Assets/ Toal Equity

= $6,040/$3,000

=2.013

(2) Retention Ratio:-

Retention Ratio= Retained Earning/ Net Income

= $710/$481

= 1.476

(3) ROA:-

ROA = (Net Income/ Average Total Assets )* 100

= ($ 481 / ($ 5,680+ $6,040)/2) * 100

=($481/$5,860) * 100

=8.208%

(4) ROE :-

ROE = (Net Income/ Common Stock) * 100

= ($481/ $3000) * 100

= 16.033%

(5) Internal Growth Rate:-

Internal Growth Rate = ((ROA * r) / (1 - (ROA * r))) * 100

= (( 8.208 * 1.476) / (1-(8.208 * 1.476))) * 100

= (0.121 / 0.879) * 100

= 13.77%

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---