You have recently accepted (10 days ago) the position of CEO of East Coast Yachts. The Board selected you among several candidates. Whenever you ascend to a leadership position (department head, or higher) it is important to establish credibility. The Board requested that you familiarize yourself with the financial position of the company and provide your initial insights. Therefore, complete the following 1-page letter to the Board of Directors:

1) Using the ratio analysis you performed in the chapter 3 case,

- What are your areas of concern?

- What do you see as strengths?

2) Regarding only your areas of concern, what actions will you take to further investigate root cause? Keep in mind that ratio analysis points to areas of strengths and weaknesses but does not often identify root cause. For example, if Receivable Turnover ratio is poor, it may be becuase of slow collections, billing problems, or the sales department negotiating longer payment terms. These are the activities you might look into. Do your best here.

3) Ratio analysis consists of two types. 1) Industry comparisons, and 2) Time series analysis. Time series looks at an individual company's ratios over time. Unfortunately, the case in chapter 3 case only gives you industry comparisons and data for year-end 2023. However, you can calculate a few time series ratios by using the 2022 balance sheet for East Coast Yacht from the previous year/chapter. That 2022 balance sheet is located in the East Coast Yacht case in chapter 2. Therefore, calculate from the chapter 2 case East Coast Yacht's Current Ratio, and Debt to Equity ratio for 2022 and compare it to your 2023 for these two ratios. How did the company do year over year? You may add your findings to question 1 and 2 above if warranted.