Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The Finnerty Furniture Company, a manufacturer and wholesaler of high-quality home furnishings, has been experiencing low profitability in the recent years. As a result, the

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
The Finnerty Furniture Company, a manufacturer and wholesaler of high-quality home furnishings, has been experiencing low profitability in the recent years. As a result, the Board of Directors has replaced the president of the firm with a new president, Cindy Jenkins, who has asked you to make an analysis of the firm's financial position. Using the financial statement information that follows, calculate the indicated ratios for Finnerty. (Show all Calculations) (3 Points each) Finnerty Furniture Company Balance Sheet As of 12/31/19 (In millions of dollars) Current Assets Current Liabilities Cash $45.00 Accounts Payable $45.00 Marketable Securities $33.00 Notes Payable $45.00 Accounts Receivable $66.00 Other $21.00 Inventory $159.00 Total current Liabilities $111.00 Total Current Assets $303.00 Other Liabilities and Equity Net Fixed Assets $147.00 Long-Term Debt $24.00 Total Assets $450.00 Common Stock $114.00 Retained Earnings $201.00 Total Equity $315.00 Total Liabilities and Equity $450.00 Finnerty Furniture Company Income Statement for the Year Ended 12/31/2019 (In millions of dollars Net Sales $ 795.00 Cost of Goods Sold $ 660.00 Selling Expenses $ 73.50 Depreciation $ 12.00 EBIT Interest Expense $ 49.50 $ 4.50 Taxable income Taxes Net Income $ 45.00 $ 18.00 $ 27.00 1.) Current Ratio 2.) Total Debt Ratio 3.) Debt/Equity Ratio 4.) Times Interest earned Ratio 5.) Inventory Turnover 6.) Days' Sales in Inventory 7.) Receivables turnover 8.) Days' sales in receivables 9.) Total asset Turnover 10.) Profit Margin 11.) Return on Assets 12.) Return on Equity 13.)Consider the following industry averages and state any comments you would make to Cindy concerning Finnerty's Liquidity, debt management, asset management, and profitability (2 points each-8 points total). These comments should consist of 1-2 paragraphs and should not be a recitation of what the averages were. There should be some analysis in you work. 14.)(6 points) Tokyo Motor Company's 2002 net income was 346,262 yen on sales of 8,021,042 yen. What was the company's profit margin? The Finnerty Furniture Company, a manufacturer and wholesaler of high-quality home furnishings, has been experiencing low profitability in the recent years. As a result, the Board of Directors has replaced the president of the firm with a new president, Cindy Jenkins, who has asked you to make an analysis of the firm's financial position. Using the financial statement information that follows, calculate the indicated ratios for Finnerty. (Show all Calculations) (3 Points each) Finnerty Furniture Company Balance Sheet As of 12/31/19 (In millions of dollars) Current Assets Current Liabilities Cash $45.00 Accounts Payable $45.00 Marketable Securities $33.00 Notes Payable $45.00 Accounts Receivable $66.00 Other $21.00 Inventory $159.00 Total current Liabilities $111.00 Total Current Assets $303.00 Other Liabilities and Equity Net Fixed Assets $147.00 Long-Term Debt $24.00 Total Assets $450.00 Common Stock $114.00 Retained Earnings $201.00 Total Equity $315.00 Total Liabilities and Equity $450.00 Finnerty Furniture Company Income Statement for the Year Ended 12/31/2019 (In millions of dollars Net Sales $ 795.00 Cost of Goods Sold $ 660.00 Selling Expenses $ 73.50 Depreciation $ 12.00 EBIT Interest Expense $ 49.50 $ 4.50 Taxable income Taxes Net Income $ 45.00 $ 18.00 $ 27.00 1.) Current Ratio 2.) Total Debt Ratio 3.) Debt/Equity Ratio 4.) Times Interest earned Ratio 5.) Inventory Turnover 6.) Days' Sales in Inventory 7.) Receivables turnover 8.) Days' sales in receivables 9.) Total asset Turnover 10.) Profit Margin 11.) Return on Assets 12.) Return on Equity 13.)Consider the following industry averages and state any comments you would make to Cindy concerning Finnerty's Liquidity, debt management, asset management, and profitability (2 points each-8 points total). These comments should consist of 1-2 paragraphs and should not be a recitation of what the averages were. There should be some analysis in you work. 14.)(6 points) Tokyo Motor Company's 2002 net income was 346,262 yen on sales of 8,021,042 yen. What was the company's profit margin

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting For Non-Accountants

Authors: David Horner

12th Edition

1789664306, 9781789664300

More Books

Students also viewed these Accounting questions

Question

5. Save raster im?

Answered: 1 week ago