Question
I need help in part B. please You have won $10,000 in the lottery and you decided to make your first investment ib the stock
I need help in part B. please
You have won $10,000 in the lottery and you decided to make your first investment ib the stock market. You are considering investing in the Retail sector and is evaluating two competitors Alpha & Beta. Below is a list of selected financial data for the two companies:
Alpha
Beta
Current Assets
$60,239
$17,200
Total Assets
$199,581
$33,440
Current Liabilities
$64,619
$16,540
Total Liabilities
$115,970
$22,597
Income Available to Shareholders
$14,694
$2,377
Share Price
$65.39
$133.58
Weighted Average number of Common Shares
3207
430
Required
Part a- 4 Marks
For each company calculate and explain briefly the following ratios from a Liquidity, Solvency and Profitability perspective as applicable.
Current Ratio
Debt to Asset Ratio
Basic EPS
Price Earnings Ratio
Part b- 2 Marks
Assuming that both companies have Complex Equity structure what other ratio you will need to calculate to assess the profitability of each company for you as a potential investor . Explain in your own word the implications of that ratio.
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