Ratios Compared with Industry Averages
Hardy Instruments, Inc., manufactures various measuring and controlling instruments. Financial statement data for the firm follow:
					2019
					(Thousands of Dollars,
					Except Earnings per Share)
		Sales revenue			$220,000
		Cost of goods sold			125,000
		Net income			10,000
		Dividends			4,300
		Earnings per share			5.00
		Hardy Instruments, Inc.
		Balance Sheets
		(Thousands of Dollars)
				Dec. 31, 2019	Dec. 31, 2018
		Assets
		Cash		$20,000	$19,000
		Accounts receivable (net)		46,000	43,000
		Inventory		39,500	43,700
		Total Current Assets		105,500	105,700
		Plant assets (net)		52,600	51,500
		Other assets		15,600	12,800
		Total Assets		$173,700	##########################
		Liabilities and Stockholders Equity
		Notes payablebanks		$6,000	$6,000
		Accounts payable		22,700	18,700
		Accrued liabilities		18,000	24,000
		Total Current Liabilities		46,700	48,700
		9% Bonds payable		40,000	40,000
		Total Liabilities		86,700	88,700
		Common stock, $25 par value (2,000,000 shares)	50,000	50,000
		Retained earnings		37,000	31,300
		Total Stockholders Equity		87,000	81,300
		Total Liabilities and Stockholders Equity	$173,700	##########################
Required
a.	Using the given data, calculate items 1 through 8 below for 2019 for Hardy Instruments, Inc. Round to two decimal points.
			Median Ratios for
			Manufacturers of Measuring and		Ratios for
			Controlling Instruments		Hardy Industries
	1	Quick ratio	1.3
	2	Current ratio	2.4
	3	Accounts receivable turnover	5.9 times
	4	Inventory turnover	3.5 times
	5	Debttoequity ratio	0.73
	6	Gross profit percentage	44.3%
	7	Return on sales	4.7%
	8	Return on assets	7.6%
b.	Calculate the dividends paid per share of common stock.
	What was the dividend payout ratio?
c.	If the most recent price per share of common stock is $65, what is the priceearnings ratio?
	The dividend yield?
d.	Explain Hardy's results in comparison to the industry (cross-sectional analysis). Address each ratio.
			Explanation
	1	Quick ratio
	2	Current ratio
	3	Accounts receivable turnover
	4	Inventory turnover
	5	Debttoequity ratio
	6	Gross profit percentage
	7	Return on sales
	8	Return on assets