Question

Data for Barry Computer Co. and its industry averages follow. The firm's debt is priced at par, so the market value of its debt equals its book value. Since dollars are in thousands, number of shares are shown in thousands too.

Barry Computer Company:
Balance Sheet as of December 31, 2018 (In Thousands)
Cash	$208,800		Accounts payable	$295,800
Receivables	435,000		Other current liabilities	139,200
Inventories	417,600		Notes payable to bank	87,000
Total current assets	$1,061,400		Total current liabilities	$522,000
			Long-term debt	$435,000
Net fixed assets	678,600		Common equity (78,300 shares)	783,000
Total assets	$1,740,000		Total liabilities and equity	$1,740,000

Barry Computer Company: Income Statement for Year Ended December 31, 2018 (In Thousands)
Sales			$3,000,000
Cost of goods sold
Materials	$1,500,000
Labor	840,000
Heat, light, and power	120,000
Indirect labor	150,000
Depreciation	60,000		2,670,000

Gross profit	$	330,000
Selling expenses		210,000
General and administrative expenses	$	60,000
Earnings before interest and taxes (EBIT)	$	60,000
Interest expense		34,800
Earnings before taxes (EBT)	$	25,200
Federal and state income taxes (40%)		10,080
Net income	$	15,120
Earnings per share	$	0.19310
Price per share on December 31, 2018	$	10.00

1. Calculate the indicated ratios for Barry. Round your answers to two decimal places.

   Ratio	Barry	Industry Average
   Current	2.03x	2.04x
   Quick	1.23x	1.20x
   Days sales outstandinga	52.92 days	25.20 days
   Inventory turnover	7.18x	7.70x
   Total assets turnover	1.72x	2.01x
   Profit margin	.50%	0.48%
   ROA	.87%	0.97%
   ROE	1.93%	2.05%
   ROIC	%	7.30%
   TIE	1.72x	1.67x
   Debt/Total capital	%	39.40%
   M/B	%	4.00%
   P/E	51.79%	54.01%
   EV/EBITDA	%	11.35%

Answer 1