Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Ratio Analysis
Solve the problem below, calculate the ratios, interpret the results against the industry average, and fill in the table on the worksheet. Then, provide an analysis of how those results can be used by the business to improve its performance.
Balance Sheet as of December 31, 2010
Gary and Company
Cash
$45
Accounts payables
Receivables
66
Notes payables
45
Inventory
159
Other current liabilities
21
Marketable securities
33
Total current liabilities
$111
Total current assets
$303
Net fixed assets
147
Long Term Liabilities
Total Assets
$450
Long-term debt
24
Total Liabilities
$135
Owners Equity
Common stock
$114
Retained earnings
201
Total stockholders' equity
315
Total liabilities and equity
Income Statement Year 2010
Net sales
$795
Cost of goods sold
660
Gross profit
135
Selling expenses
73.5
Depreciation
12
EBIT
49.5
Interest expense
4.5
EBT
Taxes (40%)
18
Net income
27
1. Calculate the following ratios AND interpret the result against the industry average:
Ratio
Your Answer
Industry Average
Your Interpretation (Good-Fair-Low-Poor)
Profit margin on sales
3%
Return on assets
9%
Receivable turnover
16X
Inventory turnover
10X
Fixed asset turnover
2X
Total asset turnover
3X
Current ratio
Quick ratio
1.5X
Times interest earned
7X
2. Analysis:
Give your interpretation of what the ratios calculations show and how the business can use this information to improve its performance. Justify all answers. Provide references.
The current price of PhelpCo is $40.00 per share. a. Given the above information about PhelpCo, what is the appropriate discount rate that should be applied to the cash flows of your project?
Management estimates the issue will cost the firm $320,000 for accounting, legal, and other costs. The underwriting spread is 7.5 percent and the issue price is $22 per share. How many shares of stock must be sold if Quali Tech is to receive suffi..
which was the same as the prior year, and its stock increased in value by 2% on the day of the announcement.
submit a paper on one of the major topics listed belowirr v. mirr valuation methodsuse of real options theory in
What are the key similarities and differences of charismatic and transformational leadership? What do you think are the impacts on followers of each?
there change for this company is expected to increase from 4000000 to 4800000. 80 of sales increase are from new
Firm A and Firm B have debt-total asset ratios of 41% and 31% and returns on total assets of 8% and 13%, respectively. What is the return on equity for Firm A and Firm B?
The interest rate in the United States is 4%, and the euro is trading at 1 euro per dollar. The euro is expected to depreciate to 1.1 euros per dollar. Calculate the interest rate in Germany.
Read an article available in the Kaplan University Online Library. Click below to view the directions and grading rubric for the article summary. Additionally, a document in the document sharing section gives you a list of items and descriptions o..
What changes would you recommend for the Brock's life insurance coverage? What types of mutual funds might be considered by the Brocks for their investment portfolio?
Calculate the NPV of the Project(Consider using an Excel spreadsheet to solve this.): Present Value of the After-Tax Project (Operating) Cash Flows, excluding Salvage Value
Prepare a pro forma balance sheet dated December 31, 2014. Discuss the financing changes suggested by the statement prepared in parta.
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd