GUIDELINES::

You will calculate several ratios for Twisted C$0$mpany and then @nalyze the financial ratio d@ta to point out strengths or weaknesses of the company.

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Twisted C$0$mpany owns and operates a small chain of pretzel stands located near colleges and universities. It has experienced significant growth in recent years. The following data are available: $($See attached ph$0$t$0)$

Problem $1$: Refer to the income statements and consolidated balance sheets above for Twisted Company.

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R$3$QUIRED: Compute the following profitability ratios for Twisted Company for $2019$ and $2018$:

$*$ Gross Profit Percentage Margin

$*$ Operating Profit Margin

$*$ Net Profit Margin Percentage

$*$ Return on Assets

$*$ Return on Equity

REQUIRED: What does the ratio data suggest about the company$$s profitability after comparing $2019$ to $2018?$

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Pr$0$blem $2$: Refer to the same income statements and consolidated balance sheets above for Twisted Company.

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REQUIRED: Compute the following leverage ratios for Twisted Company for $2019$ and $2018$:

$*$ Debt$-$to$-$Equity Ratio

$*$ Interest Coverage Ratio

REQUIRED: Discuss whether creditors are as secure in $2019$ as they were in $2018$ based on the ratio data.

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Pr$0$blem $3$: Refer to the same income statements and consolidated balance sheets above for Twisted Company.

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R$3$QUIRED: Compute the following efficiency ratios for Twisted Company for $2019$ and $2018$:

$*$ Days Sales Outstanding

$*$ Inventory Turnover

$*$ Total Asset Turnover

REQUIRED: What does the ratio data suggest about the company$$s change in efficiency?