Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

(b) The analysis of the ratio of Xera Industries based on industry averages are as below: Actual 2019 1.04 0.38 Xera Industries-Ratio Analysis Industry Actual

image text in transcribed

image text in transcribed

(b) The analysis of the ratio of Xera Industries based on industry averages are as below: Actual 2019 1.04 0.38 Xera Industries-Ratio Analysis Industry Actual Average 2018 Liquidity Ratios Current ratio 1.80 1.84 Quick ratio 0.70 0.78 Activity Ratios Inventory turnover 2.50 2.59 Average collection period 37.5 days 36.5 days Debt Ratios Debt ratio 65% 67% Times interest earned 3.8 4.0 Profitability Ratios Gross profit margin 38% 40% 2.33 57 days 61.3% 2.8 34% 3 Net profit margin Return on total assets Return on common equity Market Ratio Market book ratio 3.5% 4.0% 9.5% 3.6% 4.0% 8.0% 4.1% 4.4% 11.3% 1.1 1.2 1.3 Given this information, generally comment on the analysis of each ratios : (i) Liquidity ratios (3 marks) (ii) Profitability Ratios (5 marks) (iii) Debt Ratios. (4 marks)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Principles Of Project Finance

Authors: Rod Morrison

1st Edition

1409439828, 9781409439820

More Books

Students also viewed these Finance questions

Question

How to Calculate the Correlation Coefficient

Answered: 1 week ago

Question

Describe the options and trends in management education

Answered: 1 week ago