Question
Newton Motor Cars Industry Average Ratios Income Statement 2018 2017 2016 2018 2017 2016 Current Ratio 1.0 1.5 1.5 Sales 1,800 1,650 1,500 Debt to
| Newton Motor Cars |
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Income Statement | 2018 | 2017 | 2016 |
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| 2018 | 2017 | 2016 |
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| Current Ratio | 1.0 | 1.5 | 1.5 |
Sales | 1,800 | 1,650 | 1,500 |
| Debt to Assets | 60% | 60% | 60% |
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| Asset Turnover | 2.5 | 2.2 | 2.0 |
COGS | 780 | 765 | 750 |
| Profit Margin | 6% | 5% | 4% |
Depreciation | 300 | 300 | 300 |
| Sales Growth | 3.0% | 2.5% | 3.0% |
Selling, general & admin | 1,050 | 975 | 900 |
| Profit Growth | 20% | 25% | 5.0% |
Taxes | 150 | 150 | 150 |
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Net income | -480 | -540 | -600 |
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Balance Sheet | 2015 | 2014 | 2013 |
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Current assets | 600 | 675 | 600 |
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Property, plant & equipment | 900 | 825 | 900 |
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Total assets | 1,500 | 1,500 | 1,500 |
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Current liabilities | 525 | 600 | 600 |
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Long-term liabilities | 225 | 150 | 150 |
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Equity | 750 | 750 | 750 |
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Total Liabilities & equity | 1,500 | 1,500 | 1,500 |
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Which of the following items do not characterize Newton Motor Cars? Explain your answer.
a. Positive sales growth
b. Increasing profit margin
c. High debt and profitable
d. All of the above characterize Newton Motor Cars
Part 1 - Answer
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