Ratio Analysis - instruction below and the formula sheet is attached on the bottom. Fill in the blank for Liquidity, Solvency, Profitability ( Arrow, Root, Units & Which is better? ) and all the 5 conclusion question.

enario: u are a bank loan manager and you have had two companies (Arrow and Root) come to your bank, each requesting a 6-month loan. You must cide which company to give the loan to. quired: is file contains 4 tabs. The tabs "Arrow" and "Root" contain the respective financial statements for Arrow and Root. The "Student bmission" tab is where you will perform your calculations and written work. Part 1: (16 ratios 2 marks each =32 marks total) In the "Student Submission" tab, you will be calculating Liquidity, Solvency, and Profitability ratios for each company, stating what makes a ratio more successful, and comparing the results between the two companies to determine which company has stronger results. In columns D and E, prepare your calculations for Arrow and Root. When typing in your formulae, it is recommended to create links to the financial statement figures to avoid transposition errors. Please complete all calculations to 2 decimal places. In columns F, please indicate the units for each ratio calculation. There are drop-down menus available for you to select the units when you click into the cells in column F. If a ratio is uses \% as a unit, please leave your calculation in whole number form (ie. 5.25 instead of 0.0525 ) In column G, comment on which company has a better ratio result based on your calculations (The ratios may be the same/comparable depending on your particular version of financial statements). Please note that when comparing the working capital ratios between companies, the companies need to be considered comparable in size. For the purposes of this assignment, assume that Arrow and Root are comparable. Part 2: (5 marks) Below your calculations, you will write a short 3-4 sentence conclusion relating to which company you would approve the loan to based on your calculations from Part 1. bmission: ease have one group member upload a copy of your group's completed assignment in Brightspace. lase make sure that the names of all of your group members and your group number are included on the top of the "Student Submission" tab. ARROW LTD. INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2022 CANADIAN DOLLARS (millions of dollars) Revenue \begin{tabular}{|l|r|r|} \hline Sales Revenue & $ & 1,405 \\ \hline Rent Revenue & 507 \\ \hline Interest Revenue & 367 \\ \hline Other Revenues & $ & \\ \hline Total revenues & $ & 294 \\ \hline \end{tabular} Operating expenses \begin{tabular}{l|r|r|} \hline Cost of Goods sold & 338 \\ \hline Wages expense & 329 \\ \hline Salary expense & 142 & 92 \\ \hline Benefit expense & 25 \\ \hline Research and development expense & 93 \\ \hline Repairs and maintenance expense & 151 \\ \hline Sales and distribution costs expense & 15 & \\ \hline Depreciation expense - equipment & 15 & \\ \hline Depreciation expense - vehicles & 9 & \\ \hline Depreciation expense - furniture & 14 \\ \hline Depreciation expense - office building & & 6 \\ \hline Insurance expense & 43 \\ \hline Property taxes expense & 91 \\ \hline Food and beverage expense & 46 \\ \hline Supplies expense & 58 \\ \hline Interest expense & 11 \\ \hline Information technology expense & 107 \\ \hline Advertising expense & \\ \hline \end{tabular} * Denotes all of these sales were made on credit ARROW LTD. ROOT LTD. ROOT LTD. STATEMENT OF FINANCIAL POSITION AS AT DECEMBER 31, 2022 CANADIAN DOULARS (millions of dollars) ASSETS Current assets Property plant, and equipment Shareholders' Equity ** There were no preferred dividends declared this year. *** The weighted Average number of common shares outstanding are: 25,000,000 The Market price per common share is : 20 Notes: Please use Excel formulae to calculate your ratios. If a ratio is reported in \% form, please present your solution in whole number form (ie. 5.25 instead of 0.0525) Cells have been formatted to display 2 decimal places. Please do not adjust the cell formatting. Conclusions: You are the loan manager at a local bank. Two companies have approached you about securing a 6-month loan. Based on your calculations above, please comment on the following: 1) Assess and comment on Arrow and Root's LIQUIDITY ratios. (1 mark) 2) Assess and comment on Arrow and Root's SOLVENCY ratios, (1 mark) 3) Assess and comment on Arrow and Root's PROFITABILITY ratios. (1 mark) 4) Which company would you prefer to give the loan to between Arrow and Root? Explain why. (1 mark). 5) In 2-3 sentences, describe the concern you would have if you found out that Arrow had upgraded its accounting system this year and the company did not test the new accounting system to make sure that the system was processing data correctly? (1 mark) - enario: u are a bank loan manager and you have had two companies (Arrow and Root) come to your bank, each requesting a 6-month loan. You must cide which company to give the loan to. quired: is file contains 4 tabs. The tabs "Arrow" and "Root" contain the respective financial statements for Arrow and Root. The "Student bmission" tab is where you will perform your calculations and written work. Part 1: (16 ratios 2 marks each =32 marks total) In the "Student Submission" tab, you will be calculating Liquidity, Solvency, and Profitability ratios for each company, stating what makes a ratio more successful, and comparing the results between the two companies to determine which company has stronger results. In columns D and E, prepare your calculations for Arrow and Root. When typing in your formulae, it is recommended to create links to the financial statement figures to avoid transposition errors. Please complete all calculations to 2 decimal places. In columns F, please indicate the units for each ratio calculation. There are drop-down menus available for you to select the units when you click into the cells in column F. If a ratio is uses \% as a unit, please leave your calculation in whole number form (ie. 5.25 instead of 0.0525 ) In column G, comment on which company has a better ratio result based on your calculations (The ratios may be the same/comparable depending on your particular version of financial statements). Please note that when comparing the working capital ratios between companies, the companies need to be considered comparable in size. For the purposes of this assignment, assume that Arrow and Root are comparable. Part 2: (5 marks) Below your calculations, you will write a short 3-4 sentence conclusion relating to which company you would approve the loan to based on your calculations from Part 1. bmission: ease have one group member upload a copy of your group's completed assignment in Brightspace. lase make sure that the names of all of your group members and your group number are included on the top of the "Student Submission" tab. ARROW LTD. INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2022 CANADIAN DOLLARS (millions of dollars) Revenue \begin{tabular}{|l|r|r|} \hline Sales Revenue & $ & 1,405 \\ \hline Rent Revenue & 507 \\ \hline Interest Revenue & 367 \\ \hline Other Revenues & $ & \\ \hline Total revenues & $ & 294 \\ \hline \end{tabular} Operating expenses \begin{tabular}{l|r|r|} \hline Cost of Goods sold & 338 \\ \hline Wages expense & 329 \\ \hline Salary expense & 142 & 92 \\ \hline Benefit expense & 25 \\ \hline Research and development expense & 93 \\ \hline Repairs and maintenance expense & 151 \\ \hline Sales and distribution costs expense & 15 & \\ \hline Depreciation expense - equipment & 15 & \\ \hline Depreciation expense - vehicles & 9 & \\ \hline Depreciation expense - furniture & 14 \\ \hline Depreciation expense - office building & & 6 \\ \hline Insurance expense & 43 \\ \hline Property taxes expense & 91 \\ \hline Food and beverage expense & 46 \\ \hline Supplies expense & 58 \\ \hline Interest expense & 11 \\ \hline Information technology expense & 107 \\ \hline Advertising expense & \\ \hline \end{tabular} * Denotes all of these sales were made on credit ARROW LTD. ROOT LTD. ROOT LTD. STATEMENT OF FINANCIAL POSITION AS AT DECEMBER 31, 2022 CANADIAN DOULARS (millions of dollars) ASSETS Current assets Property plant, and equipment Shareholders' Equity ** There were no preferred dividends declared this year. *** The weighted Average number of common shares outstanding are: 25,000,000 The Market price per common share is : 20 Notes: Please use Excel formulae to calculate your ratios. If a ratio is reported in \% form, please present your solution in whole number form (ie. 5.25 instead of 0.0525) Cells have been formatted to display 2 decimal places. Please do not adjust the cell formatting. Conclusions: You are the loan manager at a local bank. Two companies have approached you about securing a 6-month loan. Based on your calculations above, please comment on the following: 1) Assess and comment on Arrow and Root's LIQUIDITY ratios. (1 mark) 2) Assess and comment on Arrow and Root's SOLVENCY ratios, (1 mark) 3) Assess and comment on Arrow and Root's PROFITABILITY ratios. (1 mark) 4) Which company would you prefer to give the loan to between Arrow and Root? Explain why. (1 mark). 5) In 2-3 sentences, describe the concern you would have if you found out that Arrow had upgraded its accounting system this year and the company did not test the new accounting system to make sure that the system was processing data correctly? (1 mark)