Use the comparative data for Sunshine State Equipment, Inc., as given in Problem 23-35. In addition, the

Question:

Use the comparative data for Sunshine State Equipment, Inc., as given in Problem 23-35. In addition, the year-end price per share of Sunshine’s stock was $50 for 2009, $25 for 2010, and $35 for 2011.

Instructions:

1. Compute financial ratios for the three years 2009–2011 as follows (for ratios normally using average balances, assume that 2008 figures are the same as 2009):

(a) Accounts receivable turnover

(b) Average collection period

(d) Number of days’ sales in inventory

(e) Fixed asset turnover

(f) Debt ratio

(g) Debt-to-equity ratio

(h) Times interest earned (Assume that Bonds Payable is the only interest-bearing liability.)

(i) Earnings per share

(j) Price-earnings ratio

(k) Book-to-market ratio

2. Based on the ratios calculated in (1), evaluate Sunshine State Equipment, Inc., in 2011 as compared with 2010.

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