Campbell Sou CASE 15 Fimencial Satement Ratio Compo Compute

Campbell Sou CASE 1-5 Fimencial Satement Ratio Compo Compute the following raties for Year 11 Asset utilization ratios: g. Werking capital turnover r Fned assets turnover s Total assets turnover Market measures (Campbel\'s stock price per share is $46.73 for Year l1) Capital structure and selvency ratios e Tetal debt to total equity w Dividend payout rate x Price-to-book ratio Operating profit margin ratio For simplicity in compoting wilcation ratios, use end-of-year values and oot average values

Solution

a. Current ratio = current assets/current liabilities = 1518.5/1278 = 1.19

b. Acid test ratio = (current assets – inventories)/current liabilities = (1518.5-706.7)/1278 = 0.64

c. Days to sell inventory = inventory/cost of goods sold*365 = 706.7/4095.5*365 = 62.98 days

d. Collection period = (accounts receivable/sales)*365 = (527.4/6204.1)*365 = 31.03 days

e. Total debt to total equity = total debt/total equity = (1278+772.6+305)/1793.4 = 1.31

f. Long term debt to equity = 772.6/1793.4 = 0.43

g. Times interest earned = Profit before interest and taxes/interest expenses = (6204.1-4095.5-936.2-306.7-56.3)/116.2 = 6.97

h. Return on total assets = net income/total assets = 401.5/4149 = 9.68%

i. Return on common equity = net income/equity = 401.5/1793.4 = 22.39%

j. Gross profit margin ratio = (sales – cost of goods sold)/sales = (6204.1-4095.5)/6204.1 = 33.99%

k. Operating profit margin ratio = EBIT/sales = (6204.1-4095.5-936.2-306.7-56.3)/6204.1 = 13.05%

l. Pretax profit margin ratio = pretax profit/sales = 667.4/6204.1 = 10.76%

m. Net profit margin ratio = net profit/sales = 401.5/6204.1 = 6.47%

n. Cash turnover = revenue/closing cash balance = 6204.1/178.9 = 34.68

o. Accounts receivable turnover = sales/accounts receivables = 6204.1/527.4 = 11.76

p. Inventory turnover = cost of goods sold/inventory = 4095.5/706.7 = 5.80

q. working capital turnover = sales/working capital = 6204.1/(1518.5-1278) = 25.80

r. fixed assets turnover = sales/fixed assets = 6204.1/1790.4 = 3.47

s. Total assets turnover = sales/total assets = 6204.1/4149 = 1.50

t. P/E/ ratio = price per share/eps = 46.73/3.16 = 14.79

u. Earnings yield = 1/P/E ratio = 1/14.79 = 6.76%

v. dividend yield = annual dividend/stock price = $1.12 per share/46.73 = 2.40%

w. dividend payout rate = dividends/net income = 137.5/401.5 = 34.25%

x. Price to book ratio = market price per share/book value per share. Market price = 46.73 (given). Book value per share = total equity/no. of shares outstanding = 1793.4/135.622676 = 13.22. Thus price to book value = 46.73/13.22 = 3.53