Ratio analysis. (LO 3)

Crystal Cromartie's Frozen Foods reported the following for the fiscal years ended September 30, 2008, and September 30, 2007.

Assume there is no outstanding preferred stock and all sales are credit sales. Calculate the following ratios.

a. Current ratio (for both years)

b. Accounts receivable turnover ratio (for 2008)

c. Inventory turnover ratio (for 2008)

d. Debt-to-equity ratio (for both years)

e. Return on equity (for 2008)
Do any of these ratios suggest problems for the company?

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September 30 (in millions) Accounts receivable Inventory Current assets 2008 2007 $ 21,265 $ 13,802 45,692 47,682 185,716 155,716 Current liabilities 80,954 72,263 Long-term liabilities 15,251 17,852 Shareholders' equity 21,871 58,035 Sales 88,455 70,223 Cost of goods sold 60,463 52,750 Interest expense Net income 21.5 43.2 1,842 1,006