In: Finance
Data for Lozano Chip Company and its industry averages follow.
Lozano Chip Company: Balance Sheet as of
December 31, 2019 (Thousands of Dollars) |
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Cash | $ 215,000 | Accounts payable | $ 600,000 | |
Receivables | 1,575,000 | Notes payable | 100,000 | |
Inventories | 1,115,000 | Other current liabilities | 550,000 | |
Total current assets | $2,905,000 | Total current liabilities | $1,250,000 | |
Net fixed assets | 1,360,000 | Long-term debt | 400,000 | |
Common equity | 2,615,000 | |||
Total assets | $4,265,000 | Total liabilities and equity | $4,265,000 |
Lozano Chip Company: Income Statement for
Year Ended December 31, 2019 (Thousands of Dollars) |
|
Sales | $7,500,000 |
Cost of goods sold | 6,375,000 |
Selling, general, and administrative expenses | 941,000 |
Earnings before interest and taxes (EBIT) | $ 184,000 |
Interest expense | 40,000 |
Earnings before taxes (EBT) | $ 144,000 |
Federal and state income taxes (25%) | 36,000 |
Net income | $ 108,000 |
Ratio | Lozano | Industry Average | |
Current assets/Current liabilities | 2.0 | ||
Days sales outstanding (365-day year) | days | 35.0 | days |
COGS/Inventory | 6.7 | ||
Sales/Fixed assets | 12.1 | ||
Sales/Total assets | 3.0 | ||
Net income/Sales | % | 1.2 | % |
Net income/Total assets | % | 3.6 | % |
Net income/Common equity | % | 9.0 | % |
Total debt/Total assets | % | 10.0 | % |
Total liabilities/Total assets | % | 60.0 | % |
For the firm, ROE is %.
For the industry, ROE is %.