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Suppose you are conducting a common size analysis of Rink Machine Co/s past three years' performance. The company did not issue new shares in these
Suppose you are conducting a common size analysis of Rink Machine Co/s past three years' performance. The company did not issue new shares in these three years and has faced some operational difficulties. The company has thus piloted some new forecasting strategies for better operations management. You have collected relevant data, made reasonable assumptions based on the information available, and calculated the following ratios. Based on the preceding information, your calculations, and your assumptions, which of the following statements can be included in your analysis report? Check all that apply. A decline in the inventory turnover ratio can be explained by the new inventory management system that the company recently adopted, which led to more efficient inventory management. Rink Machine Co.'s ability to meet its debt obligations has improved since its debt-to-equity ratio decreased from 0.30 to 0.19. A decline in the inventory turnover ratio could likely be explained by operational difficulties that the company faced, which led to duplicate orders placed to vendors. A decline in the debt-to-equity ratio implies a decline in the creditworthiness of the firm
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