Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

To analyze GM ' s financial standing for 2 0 2 0 , let's utilize various financial ratios across different categories: Short - Term Solvency:

To analyze GM's financial standing for 2020, let's utilize various financial ratios across different categories:
Short-Term Solvency:
Current Ratio = Current Assets / Current Liabilities
Quick Ratio =(Current Assets - Inventory)/ Current Liabilities
Cash Ratio = Cash and Cash Equivalents / Current Liabilities
Long-Term Solvency:
Debt-to-Equity Ratio = Total Debt / Total Equity
Debt Ratio = Total Debt / Total Assets
Interest Coverage Ratio = EBIT / Interest Expense
Turnover:
Inventory Turnover Ratio = Cost of Goods Sold / Average Inventory
Accounts Receivable Turnover Ratio = Revenue / Average Accounts Receivable
Total Asset Turnover Ratio = Revenue / Average Total Assets
Profitability:
Gross Profit Margin =(Revenue - Cost of Goods Sold)/ Revenue (
Net Profit Margin = Net Income / Revenue
Return on Assets (ROA)= Net Income / Average Total Assets
Return on Equity (ROE)= Net Income / Average Shareholders' Equity?

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_2

Step: 3

blur-text-image_3

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

Financial Accounting

Authors: Pauline Weetman

6th Edition

0273789252, 978-0273789253

More Books

Students also viewed these Accounting questions

Question

Describe the factors influencing of performance appraisal.

Answered: 1 week ago

Question

Explain the various kinds of retirement plans.

Answered: 1 week ago

Question

Explain workplace flexibility (work-life balance).

Answered: 1 week ago

Question

Discuss global issues in employee benefits.

Answered: 1 week ago