Lancelot Company has provided the following information: You have been asked to evaluate the historical performance of

Question:

Lancelot Company has provided the following information:

image text in transcribed
You have been asked to evaluate the historical performance of the company over the past five years. Lancelot has no preferred shareholders.
Selected industry ratios have remained relatively steady at the following levels for the past five years:
___________________ 2011-2015
Return on assets ................................................. 15%
Return on common shareholders' equity ..................... 23%
Times interest earned ratio ..................................... 3.5 times
Debt ratio ......................................................... 40%
Instructions
1. Prepare four line graphs with the ratio on the vertical axis and the years on the horizontal axis for the following four ratios (rounded to one decimal place:
a. Return on assets
b. Return on common shareholders' equity
c. Times interest earned ratio d. Debt ratio
Display both the company ratio and the industry benchmark on each graph so that each graph shows two lines.
2. Prepare an analysis of the graphs in (1).
Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Accounting Volume 2

ISBN: 978-0176509743

2nd Canadian edition

Authors: James Reeve, Jonathan Duchac, Sheila Elworthy, Carl S. Warren

Question Posted: