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The following financial data and ratios are typical of companies in Lydex Company's industry: Based on the visualization: a . Which of the following statements

The following financial data and ratios are typical of companies in Lydex Company's industry: Based on the visualization:
a. Which of the following statements is true?
The company's average sale period is decreasing which is an unfavorable trend.
The company's average sale period is decreasing which is a favorable trend.
The company's average sale period is increasing which is an unfavorable trend.
The company's average sale period is increasing which is a favorable trend.
b. Which of the following statements is true?
The company's average collection period is decreasing which is an unfavorable trend.
The company's average collection period is decreasing which is a favorable trend.
The company's average collection period is increasing which is an unfavorable trend.
The company's average collection period is increasing which is a favorable trend.
c. Which of the following statements is true?
The company's operating cycle is increasing and unfavorably compares to the industry average.
The company's operating cycle is increasing and favorably compares to the industry average.
The company's operating cycle is decreasing and unfavorably compares to the industry average.
The company's operating cycle is decreasing and favorably compares to the industry average.
d. Which of the following statements is true?
The company's return on assets is trendLydex companys financial statements for the last two years are as follows:
Lydex Company
Comparative Balance Sheet
This Year Last Year
Assets
Current assets:
Cash $ 960,000 $ 1,260,000
Marketable securities 0300,000
Accounts receivable, net 2,700,0001,800,000
Inventory 3,900,0002,400,000
Prepaid expenses 240,000180,000
Total current assets 7,800,0005,940,000
Plant and equipment, net 9,300,0008,940,000
Total assets $ 17,100,000 $ 14,880,000
Liabilities and Stockholders' Equity
Liabilities:
Current liabilities $ 3,900,000 $ 2,760,000
Note payable, 10%3,600,0003,000,000
Total liabilities 7,500,0005,760,000
Stockholders' equity:
Common stock, $ 78 par value 7,800,0007,800,000
Retained earnings 1,800,0001,320,000
Total stockholders' equity 9,600,0009,120,000
Total liabilities and stockholders' equity $ 17,100,000 $ 14,880,000
Lydex Company
Comparative Income Statement and Reconciliation
This Year Last Year
Sales (all on account) $ 15,750,000 $ 12,480,000
Cost of goods sold 12,600,0009,900,000
Gross margin 3,150,0002,580,000
Selling and administrative expenses 1,590,0001,560,000
Net operating income 1,560,0001,020,000
Interest expense 360,000300,000
Net income before taxes 1,200,000720,000
Income taxes (30%)360,000216,000
Net income 840,000504,000
Common dividends 360,000252,000
Net income retained 480,000252,000
Beginning retained earnings 1,320,0001,068,000
Ending retained earnings $ 1,800,000 $ 1,320,000
The following financial data and ratios are typical of companies in Lydex Companys industry:
Current ratio 2.3
Acid-test ratio 1.2
Average collection period 30 days
Average sale period 60 days
Return on assets 9.5%
Debt-to-equity ratio 0.65
Times interest earned ratio 5.7
Price-earnings ratio 10
4. Review the visualization below, and then answer the questions that follow.
Based on the visualization:
Which of the following statements is true?
multiple choice 1
The companys average sale period is decreasing which is an unfavorable trend.
The companys average sale period is decreasing which is a favorable trend.
The companys average sale period is increasing which is an unfavorable trend.
The companys average sale period is increasing which is a favorable trend.
Which of the following statements is true?
multiple choice 2
The companys average collection period is decreasing which is an unfavorable trend.
The companys average collection period is decreasing which is a favorable trend.
The companys average collection period is increasing which is an unfavorable trend.
The companys average collection period is increasing which is a favorable trend.
Which of the following statements is true?
multiple choice 3
The companys operating cycle is increasing and unfavorably compares to the industry average.
The companys operating cycle is increasing and favorably compares to the industry average.
The companys operating cycle is decreasing and unfavorably compares to the industry average.
The companys operating cycle is decreasing and favorably compares to the industry average.
Which of the following statements is true?
multiple choice 4
The companys return on assets is trending in an unfavorable direction and unfavorably compares to the industry average.
The companys return on assets is trending in an unfavorable direction but favorably compares to the industry average.
The companys return on assets is trending in a favorable direction but unfavorably compares to the industry average.
The companys return on assets is trending in a favorable direction and favorably compares to the industry average.
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