Hello tutor, my name is Nathan and I am going through my review guide before my exam on Tuesday and I was wondering if you could answer this so that I may compare it with what I got so that I am not studying the wrong answers. Thanks :D
#7 Financial Analysis The balance sheet and income statement for Khaleesi Corporation are presented below. a) Calculate the quick ratio for 2019 and 2018. Identify if the ratio has become better or worse since 2018. Khaleesi Corporation Comparative Balance Sheet As at December 31 2019 2018 2017 Assets Cash Accounts Receivable $ 18,808 $ 6,106 $ 92,748 b) Calculate the accounts receivable turnover ratio for 2019 and 2018, assuming all sales are credit sales. In which 5,072 5,762 3,050 year did the company have a better accounts receivable turnover? Inventory 17,388 18,354 19,320 Total Current Assets 41,268 31,222 120,118 Land 167,358 141,881 43,470 Equipment 177,100 123,970 88,550 Less Accumulated Depreciation 52,245 - 34,535 22,138 Total Assets $ 333,481 $ 262,538 $ 230,000 2018. c) Calculate the debt-to-asset ratio for 2019 and 2018. Identify if the ratio has become better or worse since Liabilities Accounts Payable 36,515 21,300 28,980 Salaries Payable 3,338 7,084 6,440 Current Liabilities 45,853 28,384 35,420 Long-term Notes Payable 65,205 43,470 Total Liabilities 43,470 11,058 71,854 78,890 d) Calculate the net profit margin for 2019 and 2018. Identify if the company has become better or worse since Stockholders' Equity 2018. Common Stocks 11,270 11,270 11,270 Retained Earnings 211,153 179,414 139,840 Stockholders' Equity 222,423 190,684 151,110 Liabilities + Stockholders' Equity $ 333,481 $ 262,538 $ 230,000 Khaleesi Corporation Income Statement e) Calculate the inventory turnover ratio for 2019 and 2018. In which year did the company have a better For the Year Ended December 31 inventory turnover? 2019 2018 Sales $ 227,700 $ 207,000 Cost of Goods Sold 149,040 124,200 Gross Profi 78,660 82,800 Operating expenses: Insurance Expense 1,242 L,035 f) Calculate the return on equity for 2019 and 2018. Identify if 2019 ROE is better or worse than 2018. Rent Expense 5,589 5,210 Salaries Expense 5,382 4,140 Telephone Expense 911 828 Interest Expense 2,484 1,656 Depreciation Expense 17,710 12,397 Total Operating Expenses 33 ,318 26,266 Operating Profit Before Tax 45,342 $6,534 Income Tax Expense 13,603 16,960 Net Profit (Loss) $ 31,739 $ 39,574
