Perform Ratio Analysis for the entity Compute each ratio under the four key categories ( Gross profitability , Net profitability, Earnings per share , Investment turnover , Current ratio , Quick ratio, Debt to equity ratio , Debt ratio , Annual inventory turnover In addition to computing the ratios under each of the four categories, perform DuPont Analysis as appropriate (i e for ROA and ROE) 2 Determine a value for the referenced entity using Net Income as a Perpetuity and ROE as the Discount Rate SAXTON COMPANY Income Statement For the Year Ended December 31, 2009 Sales (all on credit) $ 4,000,000 Cost of Goods Sold3,000,000 Gross Profit $ 1,000,000 Selling and Administrative Expenses 450,000 Operating Profit $ 550,000 Interest Expense 50,000 Extraordinary Loss 200,000 Earnings Before Taxes$ 300,000 Income Taxes (33 ) 100,000 Net Income $ 200,000 SAXTON COMPANY Balance Sheet As of December 31, 2009 Assets Cash $ 30,000 Accounts Receivable 350,000 Marketable Securities 50,000 Inventory 370,000 Total Current Assets $ 800,000 Net Plant and Equipment 800,000 Total Assets $ 1,600,000 Liabilities and Stockholders Equity Accounts Payable $ 50,000 Notes Payable 250,000 Total Current Liabilities $ 300,000 Long Term Liabilities 300,000 Total Liabilities $ 600,000 Common Stock 400,000 Retained Earnings 600,000 Total Stockholders Equity $ 1,000,000

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Perform Ratio Analysis for the entity. Compute each ratio under the four key categories ( Gross profitability , Net profitability, Earnings per share , Investment

Perform Ratio Analysis for the entity. Compute each ratio under the four key categories ( Gross profitability, Net profitability, Earnings per share, Investment turnover , Current ratio , Quick ratio, Debt to equity ratio, Debt ratio, Annual inventory turnover. In addition to computing the ratios under each of the four categories, perform DuPont Analysis as appropriate (i.e. for ROA and ROE).
2. Determine a value for the referenced entity using Net Income as a Perpetuity and ROE as the Discount Rate.
- SAXTON COMPANY
  
  Income Statement
  
  For the Year Ended December 31, 2009
  
  Sales (all on credit) $ 4,000,000
  
  Cost of Goods Sold3,000,000
  
  ___________
  
  Gross Profit.$ 1,000,000
  
  Selling and Administrative Expenses. 450,000
  
  _____________
  
  Operating Profit $ 550,000
  
  Interest Expense 50,000
  
  Extraordinary Loss. 200,000
  
  Earnings Before Taxes$ 300,000
  
  Income Taxes (33%). 100,000
  
  Net Income.$ 200,000
  
  SAXTON COMPANY
  
  Balance Sheet
  
  As of December 31, 2009
  
  Assets
  
  Cash $ 30,000
  
  Accounts Receivable.. 350,000
  
  Marketable Securities .. 50,000
  
  Inventory. 370,000
  
  ____________
  
  Total Current Assets. $ 800,000
  
  Net Plant and Equipment.. 800,000
  
  ____________
  
  Total Assets.$ 1,600,000
  
  Liabilities and Stockholders Equity
  
  Accounts Payable..$ 50,000
  
  Notes Payable.. 250,000
  
  _____________
  
  Total Current Liabilities..$ 300,000
  
  Long Term Liabilities 300,000
  
  ____________
  
  Total Liabilities ..$ 600,000
  
  Common Stock. 400,000
  
  Retained Earnings.. 600,000
  
  ____________
  
  Total Stockholders Equity.$ 1,000,000
  
  ____________