Firms with high levels of operating leverage experience which of the following in comparison to firms with low levels of operating leverage Firms with simple capital structures can have which of the following? Hall and Porter argue that firms have two generic alternative strategies for any particular product

1. Firms with high levels of operating leverage experience which of the following in comparison to firms with low levels of operating leverage

Higher levels of risk in operations.

2. Firms with simple capital structures can have which of the following?

declared preferred stock dividends

3. Hall and Porter argue that firms have two generic alternative strategies for any particular product. These strategies are
   Select one:

product differentiation, low-cost leadership

4. Multiples of EPS to value firms are referred to as.

price-earnings ratios

5. The following balance sheets and income statements are for Net Devices Inc., a manufacturer of small electronic devices, including calculators, personal digital assistants and mp3 players. For purposes of these questions assume that the company has an effective tax rate of 35%.
   
   BALANCE SHEETS
   
   ASSETS ($ in thousands)
   
   Fiscal year end
   2011
   2010
   2009
   Cash
   $ 875,650
   $ 571,250
   $ 154,230
   Marketable securities
   6,560
   0
   0
   Receivables
   771,580
   775,250
   902,000
   Inventories
   1,320,150
   1,254,600
   1,418,500
   Other current assets
   249,000
   231,200
   229,900
   Total current assets
   3,222,940
   2,832,300
   2,704,630
   
   Property, plant & equipment
   1,118,750
   1,100,300
   1,122,400
   
   Intangibles
   263,050
   241,000
   215,600
   Deposits & other assets
   184,500
   168,250
   168,900
   Total assets
   $4,789,240
   $4,341,850
   $4,211,530
   
   LIABILITIES ($ in thousands)
   
   Fiscal year end
   2011
   2010
   2009
   Accounts payable
   $1,178,540
   $1,061,100
   $1,138,250
   Current long term debt
   18,100
   316,500
   150,900
   Accrued expenses
   664,100
   615,900
   585,400
   Income taxes payable
   138,900
   108,400
   38,200
   Other current liabilities
   0
   0
   0
   Total current liabilities
   1,999,640
   2,101,900
   1,912,750
   
   Long term debt
   478,250
   378,400
   599,630
   Other long term liabilities
   13,350
   0
   0
   Total liabilities
   2,491,240
   2,480,300
   2,512,380
   
   Preferred stock
   850,000
   850,000
   550,000
   Common stock net
   4,000
   3,950
   3,800
   Additional Paid-in Capital
   869,000
   758,000
   689,500
   Retained earnings
   1,430,500
   1,055,000
   1,245,050
   Treasury stock
   (855,500)
   (805,400)
   (789,200)
   Shareholders' equity
   2,298,000
   1,861,550
   1,699,150
   
   Total Liab. & Equity
   $4,789,240
   $4,341,850
   $4,211,530
   
   INCOME STATEMENTS ($ in thousands)
   
   Fiscal year end
   2011
   2010
   Net sales
   $11,455,500
   $11,082,100
   Cost of Goods Sold
   (8,026,450)
   (7,940,065)
   Gross profit
   3,429,050
   3,142,035
   
   Selling, general & admin. Exp.
   (1,836,400)
   (1,789,200)
   Income before deprec. & amort.
   1,592,650
   1,352,835
   
   Depreciation & amortization
   (785,250)
   (757,250)
   Interest expense
   (46,195)
   (43,340)
   
   Income before tax
   761,205
   552,245
   Provision for income taxes
   (157,725)
   (112,290)
   Minority interest
   --
   --
   
   Net income
   $ 603,480
   $ 439,955
   
   Outstanding shares (in thousands)
   308,515
   303,095
   Preferred Dividends (in thousands)
   $85,000
   $85,000
   
   
   Refer to the information for Net Devices Inc. What is Net Devices' earnings per share for 2011?

$1.70

6. Refer to the information for Net Devices Inc. What is the inventory turnover for Net Devices for 2011?

6.23

7. Refer to the information for Net Devices Inc. What is Net Devices' return on common shareholders' equity for 2011?

42.16%

8. Refer to the information for Net Devices Inc. What is the profit margin for ROA for Net Devices for 2010?

4.22%

9. Refer to the information for Net Devices Inc. What is Net Devices' capital structure leverage ratio for 2011?

3.71

10. Refer to the information for Net Devices Inc. What is the rate of return on assets for Net Devices for 2011?

13.88%