f. Perform a percent change analysis. What does this tell you about the change in profitabilityand asset utilization? Confused on how to do the 2011 for part F.

2/1/2012 Chapter 8. Student Ch08 P 8-15 Build a Model Joshua & White Technologies: December 31 Balance Sheets (Thousands of Dollars) Assets Cash and cash equivalents Short-term investments Accounts Receivable Inventories Total current assets Net fixed assets Total assets 2012 $21,000 3,759 52,500 84,000 $161,259 218,400 $379,659 2011 $20,000 3,240 48,000 56,000 $127,240 200,000 $327,240 Liabilities and equity Accounts payable Accruals Notes payable Total current liabilities Long-term debt Total liabilities Common stock Retained Earnings Total common equity Total liabilities and equity $33,600 12,600 19,929 $66,129 67,662 $133,791 183,793 62,075 $245,868 $379,659 $32,000 12,000 6,480 $50,480 58,320 $108,800 178,440 40,000 $218,440 $327,240 Joshua & White Technologies December 31 Income Statements (Thousands of Dollars) 2012 2011 Sales $420,000 $400,000 Expenses excluding depr. and amort. 327,600 320,000 EBITDA $92,400 $80,000 Depreciation and Amortization 19,660 18,000 EBIT $72,740 $62,000 Interest Expense 5,740 4,460 EBT $67,000 $57,540 Taxes (40%) 26,800 23,016 Net Income $40,200 $34,524 Common dividends Addition to retained earnings $18,125 $22,075 $17,262 $17,262 Other Data Year-end Stock Price # of shares (Thousands) Lease payment (Thousands of Dollars) Sinking fund payment (Thousands of Dollars 2012 $90.00 4,052 $20,000 $0 2011 $96.00 4,000 $20,000 $0 Ratio Analysis Liquidity Ratios Current Ratio Quick Ratio Asset Management Ratios Inventory Turnover Days Sales Outstanding Fixed Assets Turnover Total Assets Turnover Debt Management Ratios Debt Ratio Times-interest-earned ratio EBITDA coverage ratio Profitability Ratios Profit Margin Basic Earning Power Return on Assets Return on Equity Market Value Ratios Earnings per share Price-to-earnings ratio Cash flow per share Price-to-cash flow ratio Book Value per share Market-to-book ratio 2012 2011 Industry Avg 2.44 1.17 2.52 1.41 2.58 Worsened 1.53 Worsended 5.00 45.63 1.92 1.11 7.14 43.80 2.00 1.22 7.69 Worsened 47.45 Improved 2.04 Worsended 1.23 Worsended 35.2% 12.67 4.37 33.2% 13.90 4.09 9.57% 19.16% 10.59% 16.35% 8.63% 18.95% 10.55% 15.80% 32.1% 15.33 4.18 8.86% Improved 19.48% Improved 10.93% Improved 16.10% Improved NA 10.65 NA 7.11 NA 1.72 a. Has Joshua & White's liquidity position improved or worsened? Explain. Both the current ratio and quick rtio have decreased so their liquidity position improved b. Has Joshua & White's ability to manage its assets improved or worsened? Explain. All ratios show decrease so their ability to manage its assets has improved c. How has Joshua & White's profitability changed during the last year? The profits are increaing based on the change in profitability ratios d. Perform an extended Du Pont analysis for Joshua & White for 2008 and 2009. ROE = PM x TA Turnover x Equity Multiplier 2012 16.35% 9.57% 1.11 1.54 2011 15.80% 8.63% 1.22 1.50 The ROE has improved in 2012 but managing its asswrs has decreased e. Perform a common size analysis. What has happened to the composition