Use the Following Selected Financial Information for Wilcox Corporation to Answer

question 5

Multiple Choice

Use the following selected financial information for Wilcox Corporation to answer questions . Wilcox Corporation
Income Statement
For the Year Ended December 31,2015
$\begin{array}{lr}\text { Net sales } & \$ 2,870 \\\text { Cost of goods sold } & 1,985\\\text { Gross profit } & \$ \overline{885} \\\text { Operating expenses } & 620\\\text { Operating profit } & \$ 265 \\\text { Interest expense } & 40\\\text { Earnings before taxes }&\$225\\\text { Income tax expense }&80\\\text { Net profit }&\$145\end{array}$ Wilcox Corporation
Balance Sheet
December 31, 2015
$\begin{array}{lclr}\text { Assets }&&\text { Liabilities and stockholders' equity }\\\hline\text { Current assets }&&\text { Current liabilities }\\\text { Cash } & \$ 25 & \text { Accounts payable } & \$ 85 \\\text { Short-term investments } & 15 & \text { Accrued liabilities } & 45 \\\text { Accounts receivable } & 70 & \text { Total current liabilities } & 130 \\\text { Inventory } & 150 & \text { Long-term debt } & 240\\\text { Total current assets }&260&\text { Total liabilities }&370\\\\\text { Long-term assets }&&\text { Stockholders' equity }\\\text { Net PPE } & 390 & \text { Common stock and PIC } & 80 \\\text { Goodwill } & 210 & \text { Retained earnings } & 410\\&&\text { Total stockholders' equity }&490\\\text { Total assets }&\$860&\text { Total liabilities and equity }&\$860\end{array}$ WilcoxCorporation
Statement of Cash Flow Information
For the Year Ended December 31, 2015

$\begin{array}{ll}\text { Cash from operating activities }&\$150\\\text { Investing activities: }\\\text { Capital expenditures } & \$ 60 \\\text { Acquisitions } & \$ 10\\\text { Financing activities: }\\\text { Proceeds from long-term borrowing } & \$ 50 \\\text { Payments on long-term borrowing } & \$ 25 \\\text { Payments of cash dividends } & \$ 20\\\text { Cash paid for interest } & \$ 10 \\\text { Cash paid for income taxes } & \$ 75\end{array}$
-Wilcox's total asset turnover ratio is:

• A)3.98
• B)4.22
• C)5.91
• D)3.34

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Definitions:

Treasury Bills

Short-term government securities with maturity periods of one year or less, offering a secure, low-risk investment option.

Optimal Weights

In portfolio management, it refers to the proportionate holdings of different assets that maximize the portfolio's expected return for a given level of risk.

Expected Rate

Anticipated return on an investment, often based on historical data or the inherent risk of the investment.

Dollar-weighted Return

This type of return measures the performance of an investment, taking into account the timing and magnitude of inflows and outflows of money.