Tootsie Roll Hersheys

Earning per share $0.94 $0.96

Current ratio $199,726 = 3.45 $1,426,574 = 0.88

$57,972 $1,618,770

Gross Profit Ratio $168,673 = 33.9% $1,631,569 = 33.0%

$497,717 $4,946,716

Profit margin ratio $51,625 = 10.4% $214,154 = 4.3%

$497,717 $4,946,716

Inventory Turnover $327,695 = 5.4 $3,315,147 5.3

$60,680 $624,503

Days in Inventory 365 = 68 365 = 69

5.4 days 5.3 days

Receivable Turnover Ratio $492,742 = 14.61 $4,946,716 = 9.80

$33,723 $504,979

Average Collection Period 365 = 25 days 365 = 38 days

14.61 9.80

Assets Turnover Ratio $497,717 = 0.62 $4,946,716 = 1.18

$802,182 $4,202,339

Return on Assets Ratio $51,625 = 6.44% $214,154 = 5.10%

$802,182 $4,202,339

Debt to Total Assets Ratio $174,495 = 0.21 $3,623,593 = 0.85

$812,725 $4,247,113

Times Interest Earned Ratio $77,702 = 145.2 458,827 = 3.9

$535 118,585

Payout ratio $17,421 = 33.7% $252,263 = 117.8%

$51,625 $214,154

ROE 51,625 = 8.1% 214,154 = 33.6%

634,455.50 638,172.50

Free cash flow = =

$58,189 $58,189 $322,681 $322,681

Current cash debt coverage ratio $90,064 = 1.50 $778,836 = 0.51

$60,092 $1,536,154

Cash debt coverage ratio $90,064 = 0.54 $778,836 = 0.22

$167,727 $3,548,868

Price/Earnings ratio $27.42 = 29.2 $39.40 = 41.0

$0.94 $0.96
Solution to part 1 of the project:
Tootsie Roll Hersheys

Earning per share As given in the income statement $0.94 $0.96

Current ratio Current assets $199,726 = 3.45 $1,426,574 = 0.88

Current liabilities $57,972 $1,618,770

Gross Profit Ratio Gross profit amount $168,673 = 33.9% $1,631,569 = 33.0%
Total Revenues $497,717 $4,946,716

Profit margin ratio Net income $51,625 = 10.4% $214,154 = 4.3%

Total Revenues $497,717 $4,946,716

Inventory Turnover Cost of goods sold $327,695 = 5.4 $3,315,147 5.3 Finished goods and raw materials were added together.
Average Inventory $60,680 $624,503

Days in Inventory 365 days 365 = 68 365 = 69

Inventory turnover 5.4 days 5.3 days
Solution to part 2 of the project:
Tootsie Roll Hersheys

Receivable Turnover Ratio Net credit sales $492,742 = 14.61 $4,946,716 = 9.80
Average Net Receivables $33,723 $504,979

Average Collection Period 365 365 = 25 days 365 = 38 days

Receivable Turnover Ratio 14.61 9.80

Assets Turnover Ratio Net Sales $497,717 = 0.62 $4,946,716 = 1.18

Average Total Assets $802,182 $4,202,339

Return on Assets Ratio Net Income $51,625 = 6.44% $214,154 = 5.10%

Average Total Assets $802,182 $4,202,339

Debt to Total Assets Ratio Total Liabilities $174,495 = 0.21 $3,623,593 = 0.85
Total Assets $812,725 $4,247,113

Times Interest Earned Ratio Net Income + Int Expense + Tax Expense $77,702 = 145.2 458,827 = 3.9
Interest Expense $535 118,585
Solution to part 3 of the project:
Tootsie Roll Hersheys

Payout ratio Cash dividend declared on common stock $17,421 = 33.7% $252,263 = 117.8% Note that you have to use cash dividend declared (fro
Net income $51,625 $214,154

ROE Net income - Preferred stock dividend 51,625 = 8.1% 214,154 = 33.6%
Average common stockholders' equity 634,455.50 638,172.50

Free cash flow Cash provided by operations minus capital = =

$58,189 $58,189 $322,681 $322,681
expenditures minus cash dividends paid

Current cash debt coverage ratio Cash provided by operations $90,064 = 1.50 $778,836 = 0.51
Average current liabilities $60,092 $1,536,154

Cash debt coverage ratio Cash provided by operations $90,064 = 0.54 $778,836 = 0.22
Average total liabilities $167,727 $3,548,868

Price/Earnings ratio Market price as of 12/31/2007 $27.42 = 29.2 $39.40 = 41.0

EPS as of 12/31/2007 $0.94 $0.96
o use cash dividend declared (from the retained earnings statement).