Question

December 31, 2020, 2019, 2018 (in millions) Current assets Other assets Total assets Current liabilities Long-term liabilities Stockholders' equity Total liabilities and stockholders' equity 2020 $ 707 2,419 $3,126 $ 583 1,530 1,013 $3,126 2019 $ 939 1,926 $2,865 $ 836 997 1,032 $2,865 2018 $ 793 1,725 $2,518 $ 724 870 924 $2,518 points eBook Print 2019 WIPER INC. Selected Income Statement and Other Data For the year Ended December 31, 2020 and 2019 (in millions) 2020 Income statement data: Sales $3,056 Operating income 302 Interest expense 90 Net income 209 Other data: Average number of common shares outstanding 41. 9 Total dividends paid $ 56.0 References $2,919 316 71 204 47.3 $ 52.9 Required: a. Calculate return on investment, based on net income and average total assets, for 2020 and 2019. b. Calculate return on equity for 2020 and 2019. C. Calculate working capital and the current ratio for each of the past three years. d. Calculate earnings per share for 2020 and 2019. e. If Wiper's stock had a price/earnings ratio of 14 at the end of 2020, what was the market price of the stock? f. Calculate the cash dividend per share for 2020 and the dividend yield based on the market price calculated in parte. g. Calculate the dividend payout ratio for 2020. h. Assume that accounts receivable at December 31, 2020, totaled $315 million. Calculate the number of days' sales in receivables at that date. 1. Calculate Wiper's debt ratio and debt/equity ratio at December 31, 2020 and 2019. J. Calculate the times interest earned ratio for 2020 and 2019.

Answer 1

on the a) computation of return on investment - basis of saverage total assets Average total assets L Net encome ROL 9020 2019 $312672865 $2865+2518 = $29955 $ 2691.5 $209 $204 - $209 xloo = $ 204 x 100 $2995'5 $26915 - 6.981. = 7.5801 ROT = Net ancome X100 Average total assetto 3) computation of retcero on equity The 2020 2019 ROE = Netancomex100 Equity ROE $200 x 100 $ 200x100 $ 1013 $1032 20*63119.771.

c) Computation of working capitar- and curren ratio non 12020 2019 2018. working capital $ 124 $103 $69. Chen (707-583) ($939-836)$793-724 current ratio. 1.21 1.12 1.09 S07 583. 939 836) 724 working capital = current assets - current liability current rato = current assets current liabilities d) Completation of earning per share 2020 1 2019 $4.98 $4.31. $200.) Y $ 2004 47.3 Cºg reps. Colt For Net ancome Number of shares outstanding

e epso price earling ratio = omps: 14 market price = $4.98 14 $69-72 f) calculation of cash divend per share Dividend per share = Total dividend Namber of shares 4b = $.56 : 49. = $ 1.34 Dividend yield = Dividend per shaker x 100 market price per share = $1.34 X 100 $69.72 = 1.92 / 9 Dividend payout ratio e a Dpy x 100 EPS A = $1. 34x100 2 $ 4983 26. 9001

sales t cakuration of number of dag, an receivables Sales - $3056 toroo Receivables. - $315 N Number of days = $315 x 365 o $3056 Not op 37 days & cakulation of debt ratio and debt -equity ratio 2020 2019 Debt ratio obie 69.596 63.98.1 $2113x100 $183 3 x100 $3126 $2865 Debt - Equity. & 2.08 & 9og 1.78 $2113 $1833 $1013 $1032 Debt ratio = Total liabilities x100 .1 Total Assets Debt - Equity - Debt Equity

of the times anterest earned 7 - calculation ratio 2020 2019 times Interest earned ratio 3.32 387 Irgaa] 12275) Al Tomes interest earned vatio = Nee ancome before interest and tan Interest expense