Ratio of Liabilities to Stockholders' Equity and Ratio of Fixed
Assets to Long-Term Liabilities
Recent balance...
Ratio of Liabilities to Stockholders' Equity and Ratio of Fixed
Assets to Long-Term Liabilities
Recent balance sheet information for two companies in the food
industry, Santa Fe Company and Madrid Company, is as follows (in
thousands):
Santa Fe
Madrid
Net property, plant, and equipment
$299,760
$623,040
Current liabilities
258,839
786,135
Long-term debt
369,704
560,736
Other long-term liabilities
129,896
218,064
Stockholders' equity
161,370
306,850
a. Determine the ratio of liabilities to
stockholders' equity for both companies. Round to one decimal
place....
Explain to your classmates what assets, liabilities, and equity
are and tell which financial statement includes...
Explain to your classmates what assets, liabilities, and equity
are and tell which financial statement includes these items. On a
classified balance sheet, you see current assets and current
liabilities as well as long-term assets and long-term liabilities.
Why is it important to classify items as current and long-term? How
would management use this information and how would creditors use
this information?
Revenues
$4,200
Current assets
$4,500
Current liabilities
$970
Costs
2,800
Fixed assets
5,300
Long-term debt
3,500 ...
Revenues
$4,200
Current assets
$4,500
Current liabilities
$970
Costs
2,800
Fixed assets
5,300
Long-term debt
3,500
Taxable income
$1,400
Equity
5,330
Taxes (23%)
322
Total
$9,800
Total
$9,800
Net income
$1,078
Assets, costs, and current liabilities vary directly with
revenues. Long-term debt and equity do not. The firm maintains a
constant 40 percent dividend payout rate. Revenues for the next
year are projected to increase by 25 percent.
What is the external financing needed for the next
year?
Multiple Choice...
Current Assets 30,000,000 Current Liabilities 20,000,000
Fixed Assets 70,000,000 Notes Payable 10,000,000
Total Assets: 100,000,000 Long-term...
Current Assets 30,000,000 Current Liabilities 20,000,000
Fixed Assets 70,000,000 Notes Payable 10,000,000
Total Assets: 100,000,000 Long-term debt 30,000,000
Common Stock 1,000,000
Retained Earnings 39,000,000
Total liabilities & Equity 100,000,000
The notes payable are to banks, and the interest rate on this
debt is 7%, the same as the rate on new bank loans. These bank
loans are not used for seasonal financing but instead are part of
the company's permanent capital structure. The long-term debt
consists of 30,000 bonds, each...
Orem Corporation's current liabilities are $106,800, its
long-term liabilities are $267,200, and its working capital is...
Orem Corporation's current liabilities are $106,800, its
long-term liabilities are $267,200, and its working capital is
$149,500. If the corporation's debt-to-equity ratio is 0.10, total
long-term assets must equal:
$2,789,700
$3,964,500
$3,740,000
$3,857,700
Orem Corporation's current liabilities are $119,280, its
long-term liabilities are $281,120, and its working capital is...
Orem Corporation's current liabilities are $119,280, its
long-term liabilities are $281,120, and its working capital is
$167,000. If the corporation's debt-to-equity ratio is 0.14, total
long-term assets must equal:
A) $2,860,000
B) $3,093,400
C)$2,974,120
D) $2,122,120
Accounts payable $543,000
Notes Payable $247,000
current liabilities $790,000
Long term debt $1,238,000
common equity $5,141,000...
Accounts payable $543,000
Notes Payable $247,000
current liabilities $790,000
Long term debt $1,238,000
common equity $5,141,000
Total liabilities and equity $7,169,000
A. What percentage of the firm's assets does the firm finance
using debt (liabilities)?
B. If Campbell were to purchase a new warehouse for $1.1 million
and finance it entirely with long-term debt, what would be the
firm's new debt ratio?