Problem 4-22 Ratio Analysis Data for Barry Computer Co. and its industry averages follow. Barry Computer Company: Balance Sheet as of December 31, 2011 (In Thousands) Cash $100,800 Accounts payable $100,800 Receivables 201,600 Notes payable 57,600 Inventories 144,000 Other current liabilities 64,800 Total current assets $446,400 Total current liabilities $223,200 Long-term debt $144,000 Net fixed assets 273,600 Common equity 352,800 Total assets $720,000 Total liabilities and equity $720,000 Barry Computer Company: Income Statement for Year Ended December 31, 2011 (In Thousands) Sales $1,000,000 Cost of goods sold Materials $410,000 Labor 220,000 Heat, light, and power 40,000 Indirect labor 110,000 Depreciation 30,000 $810,000 Gross profit $190,000 Selling expenses 50,000 General and administrative expenses 10,000 Earnings before interest and taxes (EBIT) $130,000 Interest expense 17,280 Earnings before taxes (EBT) 112,720 Federal and state income taxes (40%) 45,088 Net income $67,632 Calculate the indicated ratios for Barry. Round your answers to two decimal places. Ratio Barry Industry Average Current x 1.90x Quick x 1.29x Days sales outstandinga days 35.04days Inventory turnover x 7.44x Total assets turnover x 1.62x Net profit margin % 6.44% ROA % 10.44% ROE % 21.30% Total debt/total assets % 50.98% aCalculation is based on a 365-day year. Construct the extended Du Pont equation for both Barry and the industry. Round your answers to two decimal places. FIRM INDUSTRY Net profit margin % 6.44% Total assets turnover x 1.62x Equity multiplier

Problem 4-22 Ratio Analysis Data for Barry Computer Co. and its industry averages follow. Barry Computer Company: Balance Sheet as of December 31, 2011 (In Thousands) Cash $100,800 Accounts payable...

Problem 4-22

Ratio Analysis

Data for Barry Computer Co. and its industry averages follow.

Barry Computer Company:
Balance Sheet as of December 31, 2011 (In Thousands)

Cash	$100,800	Accounts payable	$100,800
Receivables	201,600	Notes payable	57,600
Inventories	144,000	Other current liabilities	64,800
Total current assets	$446,400	Total current liabilities	$223,200
		Long-term debt	$144,000
Net fixed assets	273,600	Common equity	352,800
Total assets	$720,000	Total liabilities and equity	$720,000

Barry Computer Company: Income Statement for Year Ended December 31, 2011 (In Thousands)

Sales			$1,000,000
Cost of goods sold
Materials	$410,000
Labor	220,000
Heat, light, and power	40,000
Indirect labor	110,000
Depreciation	30,000	$810,000

Gross profit		$190,000
Selling expenses		50,000
General and administrative expenses		10,000
Earnings before interest and taxes (EBIT)		$130,000
Interest expense		17,280
Earnings before taxes (EBT)		112,720
Federal and state income taxes (40%)		45,088
Net income		$67,632

Calculate the indicated ratios for Barry. Round your answers to two decimal places.

Ratio	Barry	Industry Average
Current	x	1.90x
Quick	x	1.29x
Days sales outstanding^a	days	35.04days
Inventory turnover	x	7.44x
Total assets turnover	x	1.62x
Net profit margin	%	6.44%
ROA	%	10.44%
ROE	%	21.30%
Total debt/total assets	%	50.98%

^aCalculation is based on a 365-day year.

Construct the extended Du Pont equation for both Barry and the industry. Round your answers to two decimal places.

FIRM

INDUSTRY

Net profit margin

%

6.44%

Total assets turnover

x

1.62x

Equity multiplier

Answered Same DayDec 24, 2021

Answer To: Problem 4-22 Ratio Analysis Data for Barry Computer Co. and its industry averages follow. Barry...

David answered on Dec 24 2021

111 Votes

Answer1.
Current Ratio = Current Asset/Current Liabilities
= 446400/223200 =2x
Quick Ratio = (Cash + A/C Receivable )/Current Liabilities
=(100800 + 201,600)/223200= 1.35x
Days Sales Outstanding Days = 365/Account Receivable ratio
365/(Credit Sales/Account Receivable)
=365/(1000000/201600) = 73.58 Days
Inventory Turnover ratio = COGS/Average Inventory
=...

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Problem 4-22 Ratio Analysis Data for Barry Computer Co. and its industry averages follow. Barry Computer Company: Balance Sheet as of December 31, 2011 (In Thousands) Cash $100,800 Accounts payable...

Answer To: Problem 4-22 Ratio Analysis Data for Barry Computer Co. and its industry averages follow. Barry...

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FIRM	INDUSTRY
Net profit margin	%	6.44%
Total assets turnover	x	1.62x
Equity multiplier