Selected financial data for two intense competitors in a recent year follow (amounts in millions): Sandhill Corporation Wildhorse Company Statement of income data: Net sales $3,353 $6,844 Cost of goods sold 2,957 5,709 Selling and administrative expenses 103 414 Interest expense 129 175 Other expenses 8 0 Income taxes 65 109 Net income $91 $437 Statement of cash flows data: Net cash inflow from operating activities $115 $261 Net increase in cash during the year 11 35 55 Statement of financial position data: End-of-year balances: Current assets $1,010 $1,624 Property, plant, and equipment (net) 1,852 2,968 Other assets 710 1,016 Total assets $3,572 $5,608 Current liabilities $577 $817 Long-term debt 2,204 3,132 Total shareholders' equity 791 1,659 Total liabilities and shareholders' equity $3,572 $5,608 Beginning-of-year balances: Total assets Total shareholders' equity $3,222 $5,133 750 1,257 Other data: Average net receivables Average inventory $345 $790 284 580 (a) For each company, calculate the following ratios: (Round accounts receivable turnover, inventory turnover and current ratio to 2 decimal places, e.g. 14.83. Round net debt as a percentage of total capitalization to 2 decimal places, e.g. 0.83. Round average collection period, days to sell inventory, operating cash flow ratio, interest coverage, return on asset and return on equity to 1 decimal place, e.g. 14.8 or 13.5%.) i. Average collection period for receivables ii. Days to sell inventory iii. Current ratio iv. Operating cash flow ratio V. Net debt as a percentage of total capitalization vi. Interest coverage vii. Return on assets viii. Return on equity Sandhill Corporation Average collection period days i. Days to sell inventory days ii. Current ratio Wildhorse Company days days V. Operating cash flow ratio do % % %. Net debt as a percentage of total capitalization /i. Interest coverage times times vii. Return on assets viii. Return on equity do do % % % %
Selected financial data for two intense competitors in a recent year follow (amounts in millions): Sandhill Corporation Wildhorse Company Statement of income data: Net sales $3,353 $6,844 Cost of goods sold 2,957 5,709 Selling and administrative expenses 103 414 Interest expense 129 175 Other expenses 8 0 Income taxes 65 109 Net income $91 $437 Statement of cash flows data: Net cash inflow from operating activities $115 $261 Net increase in cash during the year 11 35 55 Statement of financial position data: End-of-year balances: Current assets $1,010 $1,624 Property, plant, and equipment (net) 1,852 2,968 Other assets 710 1,016 Total assets $3,572 $5,608 Current liabilities $577 $817 Long-term debt 2,204 3,132 Total shareholders' equity 791 1,659 Total liabilities and shareholders' equity $3,572 $5,608 Beginning-of-year balances: Total assets Total shareholders' equity $3,222 $5,133 750 1,257 Other data: Average net receivables Average inventory $345 $790 284 580 (a) For each company, calculate the following ratios: (Round accounts receivable turnover, inventory turnover and current ratio to 2 decimal places, e.g. 14.83. Round net debt as a percentage of total capitalization to 2 decimal places, e.g. 0.83. Round average collection period, days to sell inventory, operating cash flow ratio, interest coverage, return on asset and return on equity to 1 decimal place, e.g. 14.8 or 13.5%.) i. Average collection period for receivables ii. Days to sell inventory iii. Current ratio iv. Operating cash flow ratio V. Net debt as a percentage of total capitalization vi. Interest coverage vii. Return on assets viii. Return on equity Sandhill Corporation Average collection period days i. Days to sell inventory days ii. Current ratio Wildhorse Company days days V. Operating cash flow ratio do % % %. Net debt as a percentage of total capitalization /i. Interest coverage times times vii. Return on assets viii. Return on equity do do % % % %
Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN:9781285595047
Author:Weil
Publisher:Weil
Chapter6: Statement Of Cash Flows
Section: Chapter Questions
Problem 16E
Related questions
Question
What is the return on assets and return on equity for Sandhill corporation and Wildhorse corporation
Transcribed Image Text:Selected financial data for two intense competitors in a recent year follow (amounts in millions):
Sandhill Corporation
Wildhorse Company
Statement of income data:
Net sales
$3,353
$6,844
Cost of goods sold
2,957
5,709
Selling and administrative expenses
103
414
Interest expense
129
175
Other expenses
8
0
Income taxes
65
109
Net income
$91
$437
Statement of cash flows data:
Net cash inflow from operating activities
$115
$261
Net increase in cash during the year
11
35
55
Statement of financial position data:
End-of-year balances:
Current assets
$1,010
$1,624
Property, plant, and equipment (net)
1,852
2,968
Other assets
710
1,016
Total assets
$3,572
$5,608
Current liabilities
$577
$817
Long-term debt
2,204
3,132
Total shareholders' equity
791
1,659
Total liabilities and shareholders' equity
$3,572
$5,608
Beginning-of-year balances:
Total assets
Total shareholders' equity
$3,222
$5,133
750
1,257
Other data:
Average net receivables
Average inventory
$345
$790
284
580
(a) For each company, calculate the following ratios: (Round accounts receivable turnover, inventory turnover and current ratio to 2 decimal
places, e.g. 14.83. Round net debt as a percentage of total capitalization to 2 decimal places, e.g. 0.83. Round average collection period, days to
sell inventory, operating cash flow ratio, interest coverage, return on asset and return on equity to 1 decimal place, e.g. 14.8 or 13.5%.)
i.
Average collection period for receivables
ii.
Days to sell inventory
iii.
Current ratio
iv.
Operating cash flow ratio
V.
Net debt as a percentage of total capitalization
vi.
Interest coverage
vii.
Return on assets
viii.
Return on equity
Sandhill Corporation
Average collection period
days
i.
Days to sell inventory
days
ii.
Current ratio
Wildhorse Company
days
days
V.
Operating cash flow ratio
do
%
%
%.
Net debt as a percentage of total capitalization
/i.
Interest coverage
times
times
vii.
Return on assets
viii.
Return on equity
do
do
%
%
%
%
AI-Generated Solution
AI-generated content may present inaccurate or offensive content that does not represent bartleby’s views.
Unlock instant AI solutions
Tap the button
to generate a solution
Recommended textbooks for you