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can you be answer A,B and C for me plases ial Statement Integrative Problem 7-17 Donna Jamison was recently hired as a financial analyst by

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ial Statement Integrative Problem 7-17 Donna Jamison was recently hired as a financial analyst by Comput tries, a manufacturer of electronic components. Her first task was to financial analysis of the firm covering the last two years. To begin, she the following financial statements and other data: ets 2015 Computron Indus was to conducta o begin, she gathered 2012 $ 57.50 351,200 Assets Cash Accounts receivable Inventories Total current assets Gross fixed assets Less: Accumulated depreciation Net fixed assets Total assets $ 52,000 402,000 836,000 $1,290,000 527,000 (166,200) $ 360,800 $1,650,800 $1,124,000 EUR 491,000 $ 344,800 $1,468,800 Liabilities and Equity Accounts payable Notes payable Accruals Total current liabilities Long-term debt Common stock (100,000 shares) Retained earnings Total equity Total liabilities and equity $ 175,200 225,000 140,000 $ 540,200 424,612 460,000 225,988 S 685,988 $1,650,800 $ 145,600 200,000 136,000 $ 481,600 323,432 460,000 203,768 $ 663,768 $1,468,800 Income Statements 2015 2014 Sales Cost of goods sold Other expenses Depreciation Total operating costs EBIT Interest expense EBT Taxes (40%) Net income EPS $3,850,000 (3,250,000) ( 430,300) 20,000) $3,700,300 $ 149,700 76,000) $ 73,700 29.480) $ 44,220 $ 0.442 $3,432,000 (2,864,000 ( 340,000 18,900 $3,222,900 $ 209,100 62.500 $ 146,600 58,640 $ 87,960 5 0.880 Chapter 7 Analysis of Financial Statements 247 Statement of Cash Flows (2015) Operating Activities Net income Additions (sources of cash) Depreciation Increase in accounts payable Increase in accruals Subtractions (ses of cash) Increases in accounts receivable Increase in inventories Net cash flow from operations 20,000 29.600 4,000 (50,800) (120,800 $173,780) Long-Term Investing and Financing Activities Investment in fixed assets Increase in notes payable Increase in long-term debt Payment of cash dividends Net cash flow from investing and financing Net reduction in cash account Cash at beginning of year Cash at end of year S(36,000) $ 25,000 101,180 (22,000) $68,180 SC 5,600) 57,600 $ 52,000 2015 2014 Other Data December 31 stock price Number of shares Dividends per share Lease payments $ 6.00 100,000 $ 0.22 $ 40,000 $ 8.50 100,000 $ 0.22 $ 40,000 Industry Average Data for 2015 Ratio Industry Average Current Quick Inventory turnover Days sales outstanding (DSO) Fixed assets turnover Total assets turnover Debt ratio TIE Fined charge coverage Net profit margin 2.78 1.0x 60x 32.0 days 10.7% 2.6% 50.0% 2.5% 2.1 x ROA 9.1% 18.2% 14.2% ROE Pricelearnings Market book 248 Part 2. General Business Concepts Assume that you are Donna Jamison's assistant and that she has asked you help her prepare a report that evaluates the company's financial condition Answer the following questions: a. What can you conclude about the company's financial condition from its statement of cash flows? b. What is the purpose of financial ratio analysis, and what are the five major categories of ratios? c. What are Computron's current and quick ratios? What do they tell you about the company's liquidity position? d. What are Computron's inventory turnover, days sales outstanding, fixed assets turnover, and total assets turnover ratios? How does the firm's utilization of assets stack up against that of the industry? e. What are the firm's debt, times interest earned, and fixed charge coverage ratios? How does Computron compare to the industry with respect to financial leverage? What conclusions can you draw from these ratios? f. Calculate and discuss the firm's profitability ratios--that is, its net profit margin, return on assets (ROA), and return on equity (ROE). g. Calculate Computron's market value ratios-that is, its price/earnings ratio and its market/book ratio. What do these ratios tell you about investors' opinions of the company? h. Use the DuPont equation to provide a summary and overview of Computron's financial condition. What are the firm's major strengths and weaknesses? i Use the following simplified 2015 balance sheet to show, in general terms, how an improvement in one of the ratiossay, the DSO-would affect the stock price. For example, if the company could improve its collection procedures and thereby lower the DSO from 38.1 days to 27.8 days, how would that change "ripple through the following financial statements (5 thousands) and influence the stock price? Accounts receivable $ 402 Debe $965 Other current assets 888 Net fixed assets 361 Equity 686 Total assets $1,651 Total liabilities and equity 51.631 Although financial statement analysis can provide useful information about a company's operations and its financial condition, this type of analysis does have some potential problems and limitations, and it must be used with care and judgment. What are some problems and limitations? Ratio Analysis Computer-Related Problem Work the problem in this section only if you are using the computer problem spreadsheet 7-18 Use the computerized model in File C07 to solve this problem. a. Refer to Problem 7-16. Suppose Cary Corporation is considering insta new computer system that would provide tighter control of inventories accounts receivable, and accounts payable. If the new system is instalice

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