This file contains 4 tabs. The tabs "Arrow" and "Root" contain the respective financial statements for Arrow and Root. The "Student Submission" tab is where you will perform your calculations and written work.

Part1: 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: 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.

- Denotes all of these sales were made on credit There were no preferred dividends declared thiz year. " The 'weighted Average number of common shares outetanding are 20,000,000 Liabilities and Shareholders" Equity Carrent Liabilities Accounte payable Accrued lisbilities Unearned Revenue Current portion of bank loan and mortgage payable Income Tax payable Total Carrent Liabilities 2.595 Won-carrent lizbilities Bank loan payable Mortgage Payable Bond payable Total Hon-carremt liabilities Total Liabilities Shareholders" Equity There were no preferred dividends declared this year. "* The 'Weighted Average number of common shares outetanding 25,000,000 The Market price per common share is: 20 You are the loan manager at a local bank. Two companies have approached gou about securing a 6-month loan. Based on gour 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 SOLYENCY ratios. [1 mark] 3) Assess and comment on Arron and Root's PROFITABILITY ratios. [1 mark] 4) Which company vould you prefer to give the loan to between Arrow and Root? Explain wh. [1 mark] 5) In 2-3 sentences. describe the concern gou would have if gou found out that Arrow had upgraded its accounting system this gear and the compang did not test the new accounting sgstem to make sure that the system was processing data correctly? [1 mark] - Denotes all of these sales were made on credit There were no preferred dividends declared thiz year. " The 'weighted Average number of common shares outetanding are 20,000,000 Liabilities and Shareholders" Equity Carrent Liabilities Accounte payable Accrued lisbilities Unearned Revenue Current portion of bank loan and mortgage payable Income Tax payable Total Carrent Liabilities 2.595 Won-carrent lizbilities Bank loan payable Mortgage Payable Bond payable Total Hon-carremt liabilities Total Liabilities Shareholders" Equity There were no preferred dividends declared this year. "* The 'Weighted Average number of common shares outetanding 25,000,000 The Market price per common share is: 20 You are the loan manager at a local bank. Two companies have approached gou about securing a 6-month loan. Based on gour 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 SOLYENCY ratios. [1 mark] 3) Assess and comment on Arron and Root's PROFITABILITY ratios. [1 mark] 4) Which company vould you prefer to give the loan to between Arrow and Root? Explain wh. [1 mark] 5) In 2-3 sentences. describe the concern gou would have if gou found out that Arrow had upgraded its accounting system this gear and the compang did not test the new accounting sgstem to make sure that the system was processing data correctly? [1 mark]