Complete ratio analysis, recognizing significant differences Home Health, Inc., has come to Jane Ross for a yearly financial checkup. As a first step, Jane has prepared a complete set of ratios for fiscal years 2018 and 2019 She will use them to look for significant changes in the company's station from one year to the next a. To focus on the degree of change, calculate the year-to-year proportional change by subtracting the year 2018 ratio from the year 2019 ratio, then dividing the difference by the year 2018 ratio. Multiply the result by 100. Preserve the positive or negative sign. The result is the percentage change in the ratio from 2018 to 2010. Calculate the proportional change for the ratios shown here. b. For any ratio that shows a year-o-year difference of 10% or more state whether the difference is in the company's favor or not. c. For the most significant changes (25% or more), look at the other ratios and cite at least one other change that may have contributed to the change in the ratio that you are discussing a. To focus on the degree of change, calculate the year-to-year proportional change for the ratios shown here. Liquidity Ratios Proportional Difference Currentrio 1x Round to two decimal places Liquidity Ratios Proportional Difference Quick ratio % Round to two decimal places) Activity Ratios Proportional Difference Inventory turnover 0% (Round to two decimal places Activity Ratios Proportional Difference Proportional Difference Activity Ratios Average collection period 0% (Round to two decimal places.) Proportional Difference Activity Ratios Total asset turnover 0% (Round to two decimal places.) Proportional Difference Debt Ratio Debt ratio % (Round to two decimal places.) Proportional Difference Debt Ratio Times interest earned ratio % (Round to two decimal places.) Profitability Ratios Gross profit margin Proportional Difference % (Round to two decimal places.) Profitability Ratios Operating profit margin Proportional Difference % (Round to two decimal places.) Profitability Ratios Net profit margin Proportional Difference (Round to two decimal places.) Proportional Difference Profitability Ratios Return on total assets % (Round to two decimal places.) Profitability Ratios Return on common equity Proportional Difference % (Round to two decimal places.) Market Ratios Prica/earnings ratio Proportional Difference % (Round to two decimal places.) Market Ratios Marketbook ratio Proportional Difference % (Round to two decimal places.) b. For any ratio that shows a year-to-year difference of 10% or more, state whether the difference is in the company's favor or not. Indicate whether the proportional difference is in the company's favor or not. (Select from the drop-down menus) Liquidity Ratios Proportional Difference Quick ratio -9.64% Company's Favor (Select from the drop-down menus) Proportional Difference Company's Favor Activity Ratios Inventory turnover Average collection period - 19.10% - 25.00 Total asset turnover 47.41% (Select from the drop-down menu.) Debt Ratio Debt ratio Proportional Difference Company's Favo 50.00% (Select from the drop-down menus.) Profitability Ratios Operating profit margin Proportional Difference Company's Favor 14.29% 40.00% Return on total assets Return on total assets Return on common equity 40.00% 98.62% (Select from the drop-down menus.) Market Ratios Market/book ratio Proportional Difference Company's Favor -8.03% c. For the most significant changes (25% or more), look at the other ratios and cite at least one other change that may have contributed to the change in the ratio that you are discussing. The average collection period decreased by - 25.90%. This could be because: (Select the best answer below.) most significant changes (25% or more), look at the other ratios and cite at least one other change that may have contributed to the change in the ratio that you are discussing. The average collection period decreased by - 25,90%. This could be because: (Select the best answer below) O A. there has been quicker collection O B. the accounts receivable decreased due to lower sales. C. there has been a change in credit terms. OD all of the above The total asset turnover has increased by 4741%. This could be because: (Select the best answer below) The total asset turnover has increased by 47.41%. This could be because: (Selec O A. sales have increased. O B. total assets have decreased. C. neither of the above. OD. both A and B. The debt ratio has increased by 50.00%. This could be because: (Select the best answer O A. there is an increase in debt. B. there is a decrease in assets. C. neither of the above. D. both A and B. The return on total assets has increased by 40.00%. This could be because: (Select the best a O A. current assets have decreased. B. total assets have decreased. O c. the earnings available for common stockholders has increased. D. all of the above. The return on common equity has increased by 98.62%. This could be because: (9 O A. the earnings available for common stockholders has increased. OB. common stock equity has decreased. O C. retained earnings have decreased. D. all of the above. Complete ratio analysis, recognizing significant differences Home Health, Inc., has come to Jane Ross for a yearly financial checkup. As a first step, Jane has prepared a complete set of ratios for fiscal years 2018 and 2019 She will use them to look for significant changes in the company's station from one year to the next a. To focus on the degree of change, calculate the year-to-year proportional change by subtracting the year 2018 ratio from the year 2019 ratio, then dividing the difference by the year 2018 ratio. Multiply the result by 100. Preserve the positive or negative sign. The result is the percentage change in the ratio from 2018 to 2010. Calculate the proportional change for the ratios shown here. b. For any ratio that shows a year-o-year difference of 10% or more state whether the difference is in the company's favor or not. c. For the most significant changes (25% or more), look at the other ratios and cite at least one other change that may have contributed to the change in the ratio that you are discussing a. To focus on the degree of change, calculate the year-to-year proportional change for the ratios shown here. Liquidity Ratios Proportional Difference Currentrio 1x Round to two decimal places Liquidity Ratios Proportional Difference Quick ratio % Round to two decimal places) Activity Ratios Proportional Difference Inventory turnover 0% (Round to two decimal places Activity Ratios Proportional Difference Proportional Difference Activity Ratios Average collection period 0% (Round to two decimal places.) Proportional Difference Activity Ratios Total asset turnover 0% (Round to two decimal places.) Proportional Difference Debt Ratio Debt ratio % (Round to two decimal places.) Proportional Difference Debt Ratio Times interest earned ratio % (Round to two decimal places.) Profitability Ratios Gross profit margin Proportional Difference % (Round to two decimal places.) Profitability Ratios Operating profit margin Proportional Difference % (Round to two decimal places.) Profitability Ratios Net profit margin Proportional Difference (Round to two decimal places.) Proportional Difference Profitability Ratios Return on total assets % (Round to two decimal places.) Profitability Ratios Return on common equity Proportional Difference % (Round to two decimal places.) Market Ratios Prica/earnings ratio Proportional Difference % (Round to two decimal places.) Market Ratios Marketbook ratio Proportional Difference % (Round to two decimal places.) b. For any ratio that shows a year-to-year difference of 10% or more, state whether the difference is in the company's favor or not. Indicate whether the proportional difference is in the company's favor or not. (Select from the drop-down menus) Liquidity Ratios Proportional Difference Quick ratio -9.64% Company's Favor (Select from the drop-down menus) Proportional Difference Company's Favor Activity Ratios Inventory turnover Average collection period - 19.10% - 25.00 Total asset turnover 47.41% (Select from the drop-down menu.) Debt Ratio Debt ratio Proportional Difference Company's Favo 50.00% (Select from the drop-down menus.) Profitability Ratios Operating profit margin Proportional Difference Company's Favor 14.29% 40.00% Return on total assets Return on total assets Return on common equity 40.00% 98.62% (Select from the drop-down menus.) Market Ratios Market/book ratio Proportional Difference Company's Favor -8.03% c. For the most significant changes (25% or more), look at the other ratios and cite at least one other change that may have contributed to the change in the ratio that you are discussing. The average collection period decreased by - 25.90%. This could be because: (Select the best answer below.) most significant changes (25% or more), look at the other ratios and cite at least one other change that may have contributed to the change in the ratio that you are discussing. The average collection period decreased by - 25,90%. This could be because: (Select the best answer below) O A. there has been quicker collection O B. the accounts receivable decreased due to lower sales. C. there has been a change in credit terms. OD all of the above The total asset turnover has increased by 4741%. This could be because: (Select the best answer below) The total asset turnover has increased by 47.41%. This could be because: (Selec O A. sales have increased. O B. total assets have decreased. C. neither of the above. OD. both A and B. The debt ratio has increased by 50.00%. This could be because: (Select the best answer O A. there is an increase in debt. B. there is a decrease in assets. C. neither of the above. D. both A and B. The return on total assets has increased by 40.00%. This could be because: (Select the best a O A. current assets have decreased. B. total assets have decreased. O c. the earnings available for common stockholders has increased. D. all of the above. The return on common equity has increased by 98.62%. This could be because: (9 O A. the earnings available for common stockholders has increased. OB. common stock equity has decreased. O C. retained earnings have decreased. D. all of the above