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Golden Lake Company wants to invest some of its excess cash in trading securities and is considering two investments, The Pull Company (PC) and
Golden Lake Company wants to invest some of its excess cash in trading securities and is considering two investments, The Pull Company (PC) and Safety Life Vests (SLV). The income statement, balance sheet, and other data for both companies follow for 2025 and 2024, as well as selected data for 2023: (Click the icon to view the data.) Read the requirements. Requirements Current ratio Now, compute the ratio for both companies for both years. (Round your answers to two decimal places, X.XX.) 1. Using the financial statements given, compute the following ratios for both companies for 2025 and 2024. Assume all sales are credit sales. Round all ratios to two decimal places. a. Current ratio b. Cash ratio Ratio Current Current Year 2025 2024 b. Cash ratio PC SLV Begin by selecting the correct formula. Cash ratio Now, compute the ratio for both companies for both years. (Round your answers to two decimal places, X.XX.) Ratio Cash Cash Year 2025 2024 c. Inventory turnover Begin by selecting the correct formula. PC SLV C. Inventory turnover d. Accounts receivable turnover e. Gross profit percentage f. Debt ratio g. Debt to equity ratio h. Profit margin ratio i. Asset turnover ratio j. Rate of return on common stockholders' equity k. I. Earnings per share Price/earnings ratio m. Dividend yield n. Dividend payout 2. Compare the companies' performance for 2025 and 2024. Make a recommendation to Golden Lake Company about investing in these companies. Which company would be a better investment, The Pull Company or Safety Life Vests? Base your answer on ability to pay current liabilities, ability to sell merchandise and collect receivables, ability to pay long-term debt, profitability, and attractiveness as an investment.
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