Question 35: assume you are purchasing an investment and decide to invest in a company in the home remodeling business.You Narrow the choice to Build It Right Inc. or For Life Corp. You assemble the following data:
(Click the icon to view that income atatermarf data.) (Cick the leon to view data at end of eumert yeer) (Cick the ioon to ylew detes at begining of oumert year) Infontiaser.\} Fead the maviremert. a. Interest coversos ratio e. Inventory-turnovar Select the fomula and then onter the amounts to compute the inventory turnover for each company. (Round the ratios to two docimai placen.) f. Total asset tumover Select the fomula and then onter the amounts to computo the fotat asset tumover for each company. (Round the ratios to fwo decimal places.) 9. Rueturn on assets h. Rebuirt on oquity 1. Earnings per share Select the formula and then enter the amounts to compute eamings per share (EPS) for each company.(Round EPS to two docimal placen.) J. Price-earnings ratio Seleot the formula and then enter the amounts to compute the prico-eamings (PE) ratio for each oompany (Found the PE ratio to two decitnel placea.) Which comparyle sigek bast fits your investrierit windegy? The T. based on the resiats of the rate analvis performed. Fi and hpute the price-earnings (PE) ratio for each company. higher than that of For Life, Corp. higher than that of Build It Right, Inc. lower than that of Build It Right, Inc. lower than that of For Life, Corp. pst fit the investment strategy. Its price-earnings ratio is and based on the results of the ratio analysis performed. W. Select the formula and then enter the amounts to compute the price-earnings (PE) ratio for each comp Build It Right, Inc. appears to be in slightly better shape than For Life, Corp. For Life, Corp. appears to be in slightly better shape than Build It Right, Inc. ce-earnings ratio sed on the results of the Data table Data table Salectedthalanca shant and markat nrica data at tha and nf tha currant vaar: Data table Salantad halanesa ehant data at the haninwina al uha More info Your investment strategy is to purchase the stock of the company that has a low price-earnings ratio but seems to be in good shape financially. Assume that you analyzed all other factors and your decision depends on the results of the ratio analysis to be performed. Requirement 1. Compute the following ratios for both companies for the current year and decide which company's stock best fits your investment strategy. Assume all sales are on credit. (Abbreviations used: ARR= accounts receivable, Avg = average, CS = common stock, EBIT = earnings before interest and taxes, Mkt = market, SE= stockholders' equity, and ST = short-term.) a. Quick ratio b. Debt ratio c. Interest coverage ratio d. Accounts receivable turnover e. Inventory turnover f. Total asset turnover g. Return on assets h. Return on equity i. Earnings per share j. Price-earnings ratio