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Points: 0 of 1 Save (Financial statement analysis) The T. P. Jarmon Company manufactures and sells a line of exclusive sportswear. The firm's sales were $600,100 for the year just ended, and its total assets exceeded $500,000. The company was started by Mr. Jarmon just 10 years ago and has been profitable every year since its inception. The chief financial officer for the firm, Brent Vehlim, has decided to seek a line of credit from the firm's bank totaling $81,000. In the past, the company has relied on its suppliers to finance a large part of its needs for inventory. However, in recent months tight money conditions have led the firm's suppliers to offer sizable cash discounts to speed up payments for purchases. Mr. Vehlim wants to use the line of credit to supplant a large portion of the firm's payables during the summer, which is the firm's peak seasonal sales period. The firm's two most recent balance sheets were presented to the bank in support of its loan request. In addition, the firm's income statement for the year just ended was provided. These statements are found in the following tables: 5. Jan Fama, associate credit analyst for the Merchants National Bank of Midland, Michigan, was assigned the task of analyzing Jarmon's loan request. a. Calculate the following financial ratios for 2013: 2 WW a. Calculate the following financial ratios for 2013: FB T. P. Jarmon's current ratio is (Round to two decimal places.) T. P. Jarmon Company Balance Sheets Jarm Vehli Supp firm's to su The f incon 2013 $13.900 Cash Marketable securities Accounts receivable Inventory Prepaid rent Total current assets Net plant and equipment $14.900 6.000 42.000 51.100 1,200 $115.200 285.900 33.100 84.100 asso loan $138.390 269.900 a. C Total assets $401.100 3408.290 a. Ca .. 2012 $48. 100 14.900 5.990 Accounts payable Notes payable Accruals 13.100 Print Done TIC puyubic Accruals TV rry Total current liabilities Long-term debt Common stockholders' equity Total liabilities and owners' equity 5,990 $68,990 160,100 172,010 $401.100 4,990 $75,190 150,000 183,100 $408 290 (Click on the icon o in order to copy its contents into a spreadsheet.) T. P. Jarmon Company Income Statement for 2013 Sales (all credit) Less: Cost of goods sold Gross profit Less: Operating and interest expenses General and administrative $600,100 (460.100) $140.000 $(30.000) Print Done $600,100 (460,100) $140,000 IIICUIUC JULITISTIC TOT ZIJ Sales (all credit) Less: Cost of goods sold Gross profit Less: Operating and interest expenses General and administrative $(30,000) Interest (10,000) Depreciation (30, 100) Total Earnings before taxes Less: Taxes Net income available to common stockholders Less: Cash dividends Change in retained earnings (Click on the icon in order to copy its contents into a spreadsheet) $(70, 100) $69.900 (27.100) $42.800 (31,800) $11.000 Print Done Ehlim, has ppliers to f m's supplie supplant a he firm's tw come state ssociate cre an request Current ratio Acid-test ratio Debt ratio Times interest earned Average collection period Inventory turnover (based on cost of goods sold) Return on equity Operating return on assets Operating profit margin Total asset turnover Fixed asset turnover h Ratio Noms 1.80 0.90 50.0% 10.00 20.0 7.00 12.0% 16.8% 14.0% 1.20 1.80 - Calculate . Calculate .P. Jarmon (Click on the icon o in order to copy its contents into a spreadsheet) Print Done