P15-29A (similar to) In its annual report, WRM Athletic Supply, Inc. includes the following five-year financial...

Transcribed Image Text:

P15-29A (similar to) In its annual report, WRM Athletic Supply, Inc. includes the following five-year financial summary: (Click the icon to view the financial summary.) Read the requirements. Current ratio 2018 2017 1.70 1.86 2016 1.69 2015 1.69 2014 2.43 Formula (0.) Now compute the debt ratio. (Round your answers to the nearest tenth percent, X.X%.) (Click the icon to view the formulas.) Requirements 2018 2017 2016 2015 2014 Debt ratio 52.4 % 50.1 % 51.1 % 55.8 % 44.2 % Formula (p.) Select the formula reference in the last column of the table and compute the debt to equity ratio for each year. (Round the ratio to two decimal places, X.XX.) (Click the icon to view the formulas.) 2018 Debt to equity ratio 2017 1.10 1.00 1.05 2016 2015 2014 1.26 0.79 Formula (q- Select the formula reference in the last column of the table and compute the times-interest-earned ratio for each year. (Round the ratio to two decimal places, X.XX.) (Click the icon to view the formulas.) Analyze the company's financial summary for the fiscal years 2014-2018 to decide whether to invest in the common stock of WRM. Include the following sections in your analysis. 1. Trend analysis for net sales revenue and net income (use 2014 as the base year). 2. Profitability analysis. 3. Evaluation of the ability to sell merchandise inventory. 4. Evaluation of the ability to pay debts. 5. Evaluation of dividends. 6. Should you invest in the common stock of WRM Athletic Supply, Inc.? Fully explain your final decision. Times-interest-earned ratio 2018 19.29 2017 2016 2015 13.56 11.31 9.16 2014 8.68 Formula (j.) Print Done Question Help (An acid-test ratio of 0.90 to 1.00 is acceptable in most industries. A current ratio for companies in most industries is around 1.50. The average debt ratio for most companies ranges from 57% to 67%, with relatively little variation from company to company.) pay its liabilities. The company's debt to total assets (its debt ratio) is not extraordinarily high, which will facilitate The current and acid-test ratios are fairly high. This indicates that the company can which is favorable the company making all payments for debt. The times-interest-earned ratio has increased from 2014 to 2018 Requirement 5. Evaluate the dividends. Begin by selecting the appropriate measurements to evaluate dividends. Choose from any drop-down list and then click Check Answer. parts remaining Clear All ? Check Answer P15-29A (similar to) In its annual report, WRM Athletic Supply, Inc. includes the following five-year financial summary: (Click the icon to view the financial summary.) Read the requirements. Current ratio 2018 2017 1.70 1.86 2016 1.69 2015 1.69 2014 2.43 Formula (0.) Now compute the debt ratio. (Round your answers to the nearest tenth percent, X.X%.) (Click the icon to view the formulas.) Requirements 2018 2017 2016 2015 2014 Debt ratio 52.4 % 50.1 % 51.1 % 55.8 % 44.2 % Formula (p.) Select the formula reference in the last column of the table and compute the debt to equity ratio for each year. (Round the ratio to two decimal places, X.XX.) (Click the icon to view the formulas.) 2018 Debt to equity ratio 2017 1.10 1.00 1.05 2016 2015 2014 1.26 0.79 Formula (q- Select the formula reference in the last column of the table and compute the times-interest-earned ratio for each year. (Round the ratio to two decimal places, X.XX.) (Click the icon to view the formulas.) Analyze the company's financial summary for the fiscal years 2014-2018 to decide whether to invest in the common stock of WRM. Include the following sections in your analysis. 1. Trend analysis for net sales revenue and net income (use 2014 as the base year). 2. Profitability analysis. 3. Evaluation of the ability to sell merchandise inventory. 4. Evaluation of the ability to pay debts. 5. Evaluation of dividends. 6. Should you invest in the common stock of WRM Athletic Supply, Inc.? Fully explain your final decision. Times-interest-earned ratio 2018 19.29 2017 2016 2015 13.56 11.31 9.16 2014 8.68 Formula (j.) Print Done Question Help (An acid-test ratio of 0.90 to 1.00 is acceptable in most industries. A current ratio for companies in most industries is around 1.50. The average debt ratio for most companies ranges from 57% to 67%, with relatively little variation from company to company.) pay its liabilities. The company's debt to total assets (its debt ratio) is not extraordinarily high, which will facilitate The current and acid-test ratios are fairly high. This indicates that the company can which is favorable the company making all payments for debt. The times-interest-earned ratio has increased from 2014 to 2018 Requirement 5. Evaluate the dividends. Begin by selecting the appropriate measurements to evaluate dividends. Choose from any drop-down list and then click Check Answer. parts remaining Clear All ? Check Answer