5 Following are data for Anand Products (Rs. in lakhs) 10 Marks
1998 1998 |
Assets 6000 Revenues 6600Short term liabilities 450 Operating expenses 5950
EBIT 650 8% debenture 1250 Dividend 50 10% bonds 500 Interest 150 Common stock (Rs.10 par) 3500 EBT 500 Surplus 300 Taxes 200 |
a) Find out the following ratios:
i) Asset turnover
ii) Effective interest rate
iii) Effective tax rate
iv) Debt/equity ratio
v) Dividend payout rate
b) What growth rate of EBIT can be expected?
Solution: Asset turnover = 6600 =1.1
6000
Effective interest rate = 150 = 0.07
2200
Effective Tax rate = 200/500 = 0.4
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