(2.7) Net operating working capital C K [i]. Rao Corporation has the following balance sheet. How…

(2.7) Net operating working capital C K [i]. Rao Corporation has the following balance sheet. How…

(2.7) Net operating working
capital C K

[i].

Rao Corporation has the following
balance sheet. How much net operating
working capital does the firm have?

Cash

$ 10

Accounts payable

$ 20

Short-term investments

Accruals

20

Accounts receivable

50

Notes payable

50

Inventory

40

Current liabilities

$ 90

Current assets

$130

Long-term debt

0

Net fixed assets

100

Common equity

30

Retained earnings

50

Total assets

$230

Total liab. & equity

$230

a.

$54.00

b.

$60.00

c.

$66.00

d.

$72.60

e.

$79.86

(2.7) Net operating profit after
taxes (NOPAT) C K

[ii].

Bae Inc. has the following income
statement. How much net operating
profit after taxes (NOPAT) does the firm have?

Sales

$2,000.00

Costs

1,200.00

Depreciation

100.00

EBIT

$ 700.00

Interest expense

200.00

EBT

$ 500.00

Taxes (35%)

175.00

Net income

$ 325.00

a.

$370.60

b.

$390.11

c.

$410.64

d.

$432.25

e.

$455.00

(2.7) Net operating profit after
taxes (NOPAT) C K

[iii].

EP Enterprises has the following
income statement. How much net
operating profit after taxes (NOPAT) does the firm have?

Sales

$1,800.00

Costs

1,400.00

Depreciation

250.00

EBIT

$ 150.00

Interest expense

70.00

EBT

$ 80.00

Taxes (40%)

32.00

Net income

$ 48.00

a.

$81.23

b.

$85.50

c.

$90.00

d.

$94.50

e.

$99.23

(2.7) Return on invested capital
(ROIC) C K

[iv].

Tibbs Inc. had the following data
for the year ending 12/31/07: Net
income = $300; Net operating profit after taxes (NOPAT) = $400; Total assets
= $2,500; Short-term investments = $200; Stockholders’ equity = $1,800; Total
debt = $700; and Total operating capital = $2,300. What was its return on invested capital
(ROIC)?

a.

14.91%

b.

15.70%

c.

16.52%

d.

17.39%

e.

18.26%

(2.7) Total operating capital C K

[v].

Zumbahlen Inc. has the following
balance sheet. How much total
operating capital does the firm have?

Cash

$ 20.00

Accounts payable

$ 30.00

Short-term investments

50.00

Accruals

50.00

Accounts receivable

20.00

Notes payable

30.00

Inventory

60.00

Current liabilities

$110.00

Current assets

$150.00

Long-term debt

70.00

Gross fixed assets

$140.00

Common stock

30.00

Accumulated deprec.

40.00

Retained earnings

40.00

Net fixed assets

$100.00

Total common equity

$ 70.00

Total assets

$250.00

Total liab. & equity

$250.00

a.

$114.00

b.

$120.00

c.

$126.00

d.

$132.30

e.

$138.92

 

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