In order to bring you up to speed with Garcia Energys current situation, you have been asked to assess Garcia Energys financial performance during 2017 and its financial position at year end 2017 To complete this assignment, you have gathered the firms 2017 financial statements (below) In addition, your assistant obtained the firms ratio values for 2015 and 2016, along with the 2017 industry average ratios During the year, lease payments were $50,000, while sinking fund payments were $25,000 To Do 1 a Calculate the firms 2017 financial ratios, and then fill in the table given at the bottom of this section (ASSUME a 365 day year) b In between 200 and 300 words, analyze the firms current financial position from both a comparative and a trend standpoint Break your analysis down into evaluations of the firms liquidity, asset management, debt, profitability, and market ratios c In between 100 and 200 words, summarize the firms overall financial position on the basis of your findings in Part I 1 and Part I 2 Garcia Energy Income Statement Year Ending December 31, 2017 Sales revenue Less Cost of goods sold Gross Profit Less Opcrating Expenses $6,075,000 4,000,200 $2,074,800 Selling expenses General and administrative exnenses Lcase payments Depreciation expense $650,000 326,000 50,000 152,000 $1,178,000 $896,800 99,500 $797,300 318 920 $ 478,380 Total operating expense Operating Profit (EBIT) Less Interest expense Net profit before taxes Less Taxes (rate 40 ) Net Profit after taxes Earnings per share Dividends per share $4 78 $4 58 Garcia Energy Income Statement Year Ending December 31, 2017 Sales revenue Less Cost of goods sold Gross Profit Less Opcrating Expenses $6,075,000 4,000,200 $2,074,800 Selling expenses General and administrative exnenses Lcase payments Depreciation expense $650,000 326,000 50,000 152,000 $1,178,000 $896,800 99,500 $797,300 318 920 $ 478,380 Total operating expense Operating Profit (EBIT) Less Interest expense Net profit before taxes Less Taxes (rate 40 ) Net Profit after taxes Earnings per share Dividends per share $4 78 $4 58

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In order to bring you up to speed with Garcia Energys current situation, you have been asked to assess Garcia Energys financial performance during 2017

In order to bring you up to speed with Garcia Energys current situation, you have been asked to assess Garcia Energys financial performance during 2017 and its financial position at year-end 2017. To complete this assignment, you have gathered the firms 2017 financial statements (below). In addition, your assistant obtained the firms ratio values for 2015 and 2016, along with the 2017 industry average ratios. During the year, lease payments were $50,000, while sinking fund payments were $25,000.

To Do:

1. a.Calculate the firms 2017 financial ratios, and then fill in the table given at the bottom of this section. (ASSUME a 365-day year)

b.In between 200 and 300 words, analyze the firms current financial position from both a comparative and a trend standpoint. Break your analysis down into evaluations of the firms liquidity, asset management, debt, profitability, and market ratios.

c. In between 100 and 200 words, summarize the firms overall financial position on the basis of your findings in Part I.1 and Part I.2.

image text in transcribed

Garcia Energy Income Statement Year Ending December 31, 2017 Sales revenue Less: Cost of goods sold Gross Profit Less: Opcrating Expenses $6,075,000 4,000,200 $2,074,800 Selling expenses General and administrative exnenses Lcase payments Depreciation expense $650,000 326,000 50,000 152,000 $1,178,000 $896,800 99,500 $797,300 318.920 $ 478,380 Total operating expense Operating Profit (EBIT) Less : Interest expense Net profit before taxes Less: Taxes (rate 40%) Net Profit after taxes Earnings per share: Dividends per share: $4.78 $4.58 Garcia Energy Income Statement Year Ending December 31, 2017 Sales revenue Less: Cost of goods sold Gross Profit Less: Opcrating Expenses $6,075,000 4,000,200 $2,074,800 Selling expenses General and administrative exnenses Lcase payments Depreciation expense $650,000 326,000 50,000 152,000 $1,178,000 $896,800 99,500 $797,300 318.920 $ 478,380 Total operating expense Operating Profit (EBIT) Less : Interest expense Net profit before taxes Less: Taxes (rate 40%) Net Profit after taxes Earnings per share: Dividends per share: $4.78 $4.58