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Suppose that the financial ratios of a potential borrowing firm take the following values: X1 = Net working capital/Tot...
13. Calculate Altman's Z-score for a firm seeking a loan with the following financial value ratios:...
13. Calculate Altman's Z-score for a firm seeking a loan with the following financial value ratios: x1=.3 x2=0 x3=-.24 x4=.15 x5=1.8 A. 2.416 B. 1.552 C. 1.329 D. 1.458
Bankruptcy Risk and Z-Score Analysis Following are selected ratios for JetBlue Airways for two recent fiscal...
Bankruptcy Risk and Z-Score Analysis Following are selected ratios for JetBlue Airways for two recent fiscal years. Ratio 2016 2015 Current ratio 0.604 0.705 Working capital to total assets (0.069) (0.104) Retained earnings to total assets 0.258 0.194 EBIT to total assets 0.138 0.141 EBITDA to total assets 0.180 0.181 Market value of equity to total liabilities 1.380 1.342 Sales to total assets 0.699 0.742 Compute and interpret Altman Z-scores for the company for both years. (Do not round until...
Bankruptcy Risk and Z-Score Analysis Following are selected ratios for JetBlue Airways for two recent fiscal...
Bankruptcy Risk and Z-Score Analysis Following are selected ratios for JetBlue Airways for two recent fiscal years. Ratio 2016 2015 Current ratio 0.604 0.705 Working capital to total assets (0.069) (0.104) Retained earnings to total assets 0.258 0.194 EBIT to total assets 0.138 0.141 EBITDA to total assets 0.180 0.181 Market value of equity to total liabilities 1.380 1.342 Sales to total assets 0.699 0.742 Compute and interpret Altman Z-scores for the company for both years. (Do not round until...
What does Z-Score tell you and what can you interpret from the table?
What does Z-Score tell you and what can you interpret from the
table?
PARAMETERS Income statement Net sales Operating income Balance sheet Current assets Total assets Current lia bilities Total liabilities Retained earnings Public companies Market value of equity Private companies Book value of equity CALCUATIONS 141,576 4,480 20,289 40,830 19,926 27,727 7,887 102,155 N/A Z1 Z2 Factor Public Private General Use Working capital/Total assets Retained earning/Total assets EBIT/Total assets Market value of equity/Total liabilities X1 0.0089 1.2 6.56 0.1932...
QUESTION FOUR (20 MARKS) A protection buyer purchases 6-year protection on a company at a default...
QUESTION FOUR (20 MARKS) A protection buyer purchases 6-year protection on a company at a default swap spread of 400bp. The face value of the protection is K1, 000,000 million. What is the premium payment per year assuming that payments are done monthly? (4 Marks) Explain the difference between the basic indicator approach, the standardized approach, and the advanced measurement approach for calculating operational risk under Basel II (6 Marks) Explain the FIVE Pillars under Basel III AND What is...
QUESTION 12 a). Why are cash flow statements sometimes considered more useful than profit statements? b)....
QUESTION 12 a). Why are cash flow statements sometimes considered more useful than profit statements? b). The income statement below is for Aboagye Ltd for the year ended December 31, 2010 GHCm 9,000 (7,710) Revenue Cost (except depreciation and interest) Depreciation Interest expense, net Income taxes Net income Aboagye Ltd: balance sheet as at December 31, 2010 (181) (215) 800 Non-current assets Current assets Total assets GHC m 5,500 4.500 10,000 Capital and reserves Ordinary share capital (1,600 million shares)...
Using the financial ratios provided in Table 4.1 and the financial statement infor- mation presented below...
Using the financial ratios provided in Table 4.1 and the financial statement infor- mation presented below for Costco Wholesale Corporation, calculate the follow ing ratios for Costco for both 2013 and 2014: a. Gross profit margin b. Operating profit margin c. Net profit margin d. Times-interest-earned (or coverage) ratio e. Return on stockholders' equity 1. 1 f. Return on assets g. Debt-to-equity ratio h. Days of inventory . Inventory turnover ratio j. Average collection period Based on these ratios, did...
2013 2014 2015 Formula Current Ratio Quick Ratio Operating Cash Flow to Average Current Liabiliti...
2013 2014 2015 Formula Current Ratio Quick Ratio Operating Cash Flow to Average Current Liabilities Days Accounts Receivable 1 Low ST liquidity risk high Low ST liquidity risk 0.4 Low ST liquidity risk Current Assets/ Current Liabilities (Cash+ShortTermInvestments+AccountsReceivable Current Liabilities Operating Cash Flow/0.5(Current Liabilities-2Year) 365/Accounts Receivable Turnover Ratio Accounts Receivable Turnover-Sales 0.5(Accounts Receivable-2Year) 565 Inventory lurnover Ratio Inventory Turnover Ratio Costs of Goods Sold'0.5(Inventory-2Year) 365/Accounts Payable Tumover Ratio Accounts Payable Turnover-Purchase 0.5(Accounts Payable-2Year) Purchase-Cost of Goods Sold+Ending Inventory-Beginning Inventory Days...
2013 2014 2015 Formula Current Ratio Quick Ratio Operating Cash Flow to Average Current Liabilities Days...
2013 2014 2015 Formula Current Ratio Quick Ratio Operating Cash Flow to Average Current Liabilities Days Accounts Receivable 1 Low ST liquidity risk high Low ST liquidity risk 0.4 Low ST liquidity risk Current Assets/ Current Liabilities (Cash+ShortTermInvestments+AccountsReceivable Current Liabilities Operating Cash Flow/0.5(Current Liabilities-2Year) 365/Accounts Receivable Turnover Ratio Accounts Receivable Turnover-Sales 0.5(Accounts Receivable-2Year) 565 Inventory lurnover Ratio Inventory Turnover Ratio Costs of Goods Sold'0.5(Inventory-2Year) 365/Accounts Payable Tumover Ratio Accounts Payable Turnover-Purchase 0.5(Accounts Payable-2Year) Purchase-Cost of Goods Sold+Ending Inventory-Beginning Inventory Days...
QUESTIONS 1. Complete the 1992 columns of Tables 3 through 6, disregarding for now the projected...
QUESTIONS 1. Complete the 1992 columns of Tables 3 through 6, disregarding for now the projected data in the 1993 and 1994 columns. If you are using the spreadsheet model, use it to complete the tables. Be sure you understand all the numbers, as it would be most embarrassing and harmful to your career) if you were asked how you got a particular number and you could not give a meaningful response. 2. Based on the information in the case...
What does Z-Score tell you and what can you interpret from the
table?
PARAMETERS Income statement Net sales Operating income Balance sheet Current assets Total assets Current lia bilities Total liabilities Retained earnings Public companies Market value of equity Private companies Book value of equity CALCUATIONS 141,576 4,480 20,289 40,830 19,926 27,727 7,887 102,155 N/A Z1 Z2 Factor Public Private General Use Working capital/Total assets Retained earning/Total assets EBIT/Total assets Market value of equity/Total liabilities X1 0.0089 1.2 6.56 0.1932...
QUESTION 12 a). Why are cash flow statements sometimes considered more useful than profit statements? b). The income statement below is for Aboagye Ltd for the year ended December 31, 2010 GHCm 9,000 (7,710) Revenue Cost (except depreciation and interest) Depreciation Interest expense, net Income taxes Net income Aboagye Ltd: balance sheet as at December 31, 2010 (181) (215) 800 Non-current assets Current assets Total assets GHC m 5,500 4.500 10,000 Capital and reserves Ordinary share capital (1,600 million shares)...
Using the financial ratios provided in Table 4.1 and the financial statement infor- mation presented below for Costco Wholesale Corporation, calculate the follow ing ratios for Costco for both 2013 and 2014: a. Gross profit margin b. Operating profit margin c. Net profit margin d. Times-interest-earned (or coverage) ratio e. Return on stockholders' equity 1. 1 f. Return on assets g. Debt-to-equity ratio h. Days of inventory . Inventory turnover ratio j. Average collection period Based on these ratios, did...
2013 2014 2015 Formula Current Ratio Quick Ratio Operating Cash Flow to Average Current Liabilities Days Accounts Receivable 1 Low ST liquidity risk high Low ST liquidity risk 0.4 Low ST liquidity risk Current Assets/ Current Liabilities (Cash+ShortTermInvestments+AccountsReceivable Current Liabilities Operating Cash Flow/0.5(Current Liabilities-2Year) 365/Accounts Receivable Turnover Ratio Accounts Receivable Turnover-Sales 0.5(Accounts Receivable-2Year) 565 Inventory lurnover Ratio Inventory Turnover Ratio Costs of Goods Sold'0.5(Inventory-2Year) 365/Accounts Payable Tumover Ratio Accounts Payable Turnover-Purchase 0.5(Accounts Payable-2Year) Purchase-Cost of Goods Sold+Ending Inventory-Beginning Inventory Days...
2013 2014 2015 Formula Current Ratio Quick Ratio Operating Cash Flow to Average Current Liabilities Days Accounts Receivable 1 Low ST liquidity risk high Low ST liquidity risk 0.4 Low ST liquidity risk Current Assets/ Current Liabilities (Cash+ShortTermInvestments+AccountsReceivable Current Liabilities Operating Cash Flow/0.5(Current Liabilities-2Year) 365/Accounts Receivable Turnover Ratio Accounts Receivable Turnover-Sales 0.5(Accounts Receivable-2Year) 565 Inventory lurnover Ratio Inventory Turnover Ratio Costs of Goods Sold'0.5(Inventory-2Year) 365/Accounts Payable Tumover Ratio Accounts Payable Turnover-Purchase 0.5(Accounts Payable-2Year) Purchase-Cost of Goods Sold+Ending Inventory-Beginning Inventory Days...
QUESTIONS 1. Complete the 1992 columns of Tables 3 through 6, disregarding for now the projected data in the 1993 and 1994 columns. If you are using the spreadsheet model, use it to complete the tables. Be sure you understand all the numbers, as it would be most embarrassing and harmful to your career) if you were asked how you got a particular number and you could not give a meaningful response. 2. Based on the information in the case...
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