Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Using Financial Ratios and the company and industry information answer the following questions. Company 2018 2019 Sales 38,578,155 42,000,000 Inventory 3,210,000 4,118,000 Total Assets 17,254,819

Using Financial Ratios and the company and industry information answer the following questions.

Company

2018

2019

Sales

38,578,155

42,000,000

Inventory

3,210,000

4,118,000

Total Assets

17,254,819

23,917,000

Debt

7,026,000

10,388,000

Equity

10,228,819

16,529,000

Net Income

6,268,975

8,410,908

EBIT

9,873,447

13,119,000

Current Assets

10,535,819

15,066,000

Current Liabilities

3,980,000

4,342,000

Industry Average

2018

2019

Current Ratios

2.89

3.26

Total Asset Turnover

2.14

2.33

Debt-Equity

31.3%

30.2%

Return on Total Assets`

32.34%

41.87%

Return on Equity

43.6%

48.3%

Sales Growth

3%

6%

Part 1 For the company calculate ROE and Asset Turnover for 2019

A) 50.9% and 1.76

B) 79.4% and 2.23

C) 63.4% and 1.76

D) 50.9% and .56

Part 2 Interpret which of these ratios show improvement

A) Return on Equity, Total Asset Turnover

B) Total Asset Turnover, Current Ratio

C) Current Ratio, Debt to equity

D) Return on Total Assets, Debt to equity

Part 3 Evaluate what the company is doing well in Comparison to the Industry

  1. Sales Growth, Asset utilization, Debt burden
  2. Short-term liquidity, debt burden, return on assets
  3. Return on equity, Asset utilization, debt burden
  4. Sales Growth, Return on equity, short-term liquidity

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

Financial Management Core Concepts

Authors: Ray Brooks, Raymond Brooks

1st Edition

0321155173, 9780321155177

More Books

Students also viewed these Finance questions