Presented here are summarized data from the balance sheets and income statements of Wiper, Inc.:
WIPER, INC.
Condensed Balance Sheets
December 31, 2017, 2016, 2015
(in millions)
Current assets
Other assets
Total assets
Current liabilities
Long-term liabilities
Stockholders’ equity
Total liabilities and stockholders' equity 2017
$ 685
2,417
$3,102 2016
$ 917
1,924
$2,841 2015
$ 773
1,723
$2,496 $ 581
1,510
1,011
$3,102 $ 816
995
1,030
$2,841 $ 714
860
922
$2,496 WIPER, INC
Selected Income Statement and Other Data
For the year Ended December 31, 2017 and 2016
(in millions)
Income statement data:
Sales
Operating income
Interest expense
Net income
Other data:
Average number of common shares outstanding
Total dividends paid 2017 2016 $3,054
300
88
203 $2,917
314
69
198 41.7
$ 54.0 47.1
$ 52.7 Required:
a. Calculate return on investment, based on net income and average total assets, for 2017 and 2016. (Do not round intermediate
calculations. Round your answers to 1 decimal place.)
2017
Return on investment 2016 6.5 % 7.0 % b. Calculate return on equity for 2017 and 2016. (Round your answers to 1 decimal place.)
2017
Return on equity 2016 19.9 % 20.3 % c. Calculate working capital and the current ratio for each of the past three years. (Enter your answers in millions (i.e., 5,000,000
should be entered as 5). Round "Current ratio" to 1 decimal place.)
2017
Working capital
Current ratio $ 2016 2015 104 $ 101 $ 59 1.2 1.1 1.1 d. Calculate earnings per share for 2017 and 2016. (Round your answers to 2 decimal places.) 2017
Earnings per share $ 2016 4.87 $ 4.20 e. If Wiper's stock had a price/earnings ratio of 11 at the end of 2017, what was the market price of the stock? (Do not round
intermediate calculations. Round your answer to 2 decimal places.)
Market price f. Calculate the cash dividend per share for 2017 and the dividend yield based on the market price calculated in part e. (Do not round
intermediate calculations. Round your answers to 2 decimal places.) Cash dividends per
share
Dividend yield % g. Calculate the dividend payout ratio for 2017. (Do not round intermediate calculations.)
Dividend payout ratio % h. Assume that accounts receivable at December 31, 2017, totaled $313 million. Calculate the number of days' sales in receivables at
that date. (Use 365 days a year. Do not round intermediate calculations.)
Number of days' sales days i. Calculate Wiper's debt ratio and debt/equity ratio at December 31, 2017 and 2016. (Round "Debt ratio" to 1 decimal place and
"Debt/equity ratio" to the nearest whole percent.)
2017 2016 Debt ratio % % Debt/equity ratio % % j. Calculate the times interest earned ratio for 2017 and 2016. (Round your answers to 1 decimal place.)
2017
Times interest earned times 2016
times rev: 12_21_2016_QC_CS-72879 References Worksheet Check my work Difficulty: 2 Medium

 

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