Problem
I.
i. Firm D has net income of $54,000, sales of $1,200,000, and average total assets of $750,000. Calculate the firm's margin, turnover, and ROI.
ii. Firm E has net income of $132,000, sales of $2,200,000, and ROI of 9.6%. Calculate the firm's turnover and average total assets.
iii. Firm F has ROI of 12%, average total assets of $1,500,000, and turnover of 0.8. Calculate the firm's sales, margin, and net income.
II. Evans Inc. had current liabilities at April 30 of $275,000. The firm's current ratio at that date was 2.1.
i. Calculate the firm's current assets and working capital at April 30.
ii. Assume that management paid $27,500 of accounts payable on April 29. Calculate the current ratio and working capital at April 30 as if the April 29 payment had not been made.
iii. Identify the changes, if any, to working capital and the current ratio that would be caused by the April 29 payment.