1.) Personal After-Tax
Corporate bonds issued by Johnson Corporation currently yield 8%. Municipal bonds of equal risk currently yield 6%. At what tax rate would an investor be indifferent between these two bonds?
2) Balance Sheet Analysis
Complete the balance sheet and sales information in the table that follows for J. White Industries using the following financial data:
Total assets turnover: 1.5
Gross profit margin on sales: (Sales - Cost of goods sold) / Sales = 25%
Total liabilities-to-assets ratio: 40%
Quick ratio: 0.80
Days sales outstanding (based on 365-day year): 36.5 days
Inventory turnover ratio: 3.75
Partial Income Statement
Information
Sales __________
Cost of goods sold __________
Balance Sheet
Cash __________ Accounts payable ___________
Accounts receivable __________ Long-term debt 50,000
Inventories __________ Common Stock ___________
Fixed Assets __________ Retained earnings ___________
Total Assets $400,000 Total liabilities and equity __________
1.) Personal After-Tax
Corporate bonds issued by Johnson Corporation currently yield 8%. Municipal bonds of equal risk currently yield 6%. At what tax rate would an investor be indifferent between these two bonds?
2) Balance Sheet Analysis
Complete the balance sheet and sales information in the table that follows for J. White Industries using the following financial data:
Total assets turnover: 1.5
Gross profit margin on sales: (Sales - Cost of goods sold) / Sales = 25%
Total liabilities-to-assets ratio: 40%
Quick ratio: 0.80
Days sales outstanding (based on 365-day year): 36.5 days
Inventory turnover ratio: 3.75
Partial Income Statement
Information
Sales __________
Cost of goods sold __________
Balance Sheet
Cash __________ Accounts payable ___________
Accounts receivable __________ Long-term debt 50,000
Inventories __________ Common Stock ___________
Fixed Assets __________ Retained earnings ___________
Total Assets $400,000 Total liabilities and equity __________
Related questions
Complete the balance sheet and sales information in the table that follows for Hoffmeister Industries using the following financial data:
Debt ratio: 60%
Quick ratio: 1.25
Total assets turnover: 2.8
Days sales outstanding: 36 days*
Gross profit margin on sales: (Sales - Cost of goods sold)/Sales = 23%
Inventory turnover ratio: 7.0
* Calculation is based on a 365-day year.
Round your answers to the nearest whole dollar.
Balance Sheet
| Cash | $ | Accounts payable | $ |
| Accounts receivable | $ | Long-term debt | $ 60,000 |
| Inventories | $ | Common stock | $ |
| Fixed assets | $ | Retained earnings | $ 97,500 |
| Total assets | $ 300,000 | Total liabilities and equity | $ |
| Sales | $ | Cost of goods sold | $ |
