Even complicated and confusing topics will be easily developed and covered if you request our help writing an essay. Place an order today!

PRyC WP: Add custom content to bottom of post/page: Standard Content START

Assignment 3: Ratio Analysis

By  Wednesday, February 17, 2016 solve the problem below, calculate the ratios, interpret the results against the industry average, and fill in the table on the worksheet. Then,  provide an analysis of how those results can be used by the business to improve its performance. Turn in your completed work to the  M1: Assignment 3 Dropbox by , February, 2016.

Balance Sheet as of December 31, 2010

Gary and Company

Cash  

$45

 

Accounts payables  

$45

Receivables    

66

 

Notes payables 

45

Inventory

159

 

Other current liabilities 

21

Marketable securities

33

 

Total current liabilities

$111

Total current assets 

$303

 

 

 

Net fixed assets  

147

 

Long Term Liabilities

 

Total Assets  

$450

 

Long-term debt  

24

 

 

Total Liabilities 

$135

 

 

 

 

 

 

Owners Equity

 

 

 

Common stock

$114

 

 

Retained earnings

201

 

 

Total stockholders’ equity

315

 

 

 

Total liabilities and equity

$450

 

Income Statement Year 2010

 

 

Net sales

$795

Cost of goods sold 

660

Gross profit  

135

Selling expenses  

73.5

Depreciation

12

EBIT

49.5

Interest expense  

4.5

EBT

45

Taxes (40%)  

18

Net income

27

 

1. Calculate the following ratios AND interpret the result against the industry average:

Ratio

Your Answer

Industry Average

Your Interpretation
(Good-Fair-Low-Poor)

Profit margin on sales

 

3%

 

Return on assets

 

9%

 

Receivable turnover

 

16X

 

Inventory turnover

 

10X

 

Fixed asset turnover

 

2X

 

Total asset turnover

 

3X

 

Current ratio

 

2X

 

Quick ratio

 

1.5X

 

Times interest earned

 

7X

 

 

2. Analysis:

Give your interpretation of what the ratios calculations show and how the business can use this information to improve its performance. Justify all answers.

 

Assignment 3 Grading Criteria
Maximum Points
Has correctly calculated the ratios.
40
Has correctly analyzed and interpreted the significance of the resulting ratios and suggested actions for improvement.
40
Wrote in a clear, concise, and organized manner; demonstrated ethical scholarship in accurate representation and attribution of sources; displayed accurate spelling, grammar, and punctuation
20
Total:
100

 

 
PRyC WP: Add custom content to bottom of post/page
/PRyC WP: Add custom content to bottom of post/page

testimonials icon
In this course, you have learned that social policies are formulated to solve social problems considered important by a mass of voters, media, and...
testimonials icon
Anyone willing to committ to five weeks? :) packaged...
testimonials icon
Running Head: LEGALITY OF BITCOINSStudent nameProfessor nameCourse titleDate of submission1LEGALITY OF BITCOINS2Bitcoins were developed back in 2008...
testimonials icon
MHR 6451Regular performance evaluations assist the organization in improving a variety of aspectsColumbia Southern UniversityMHR 6451 Human Resource...
testimonials icon
Answer the following questions based on resources such as the CIA World Factbook https://www.cia.gov/...
testimonials icon
Ellison and boyd describe social network sites as being first a communication platform, and second...
testimonials icon
Dissecting an Action Research ArticleRead Nunn et al’s 2015 article, ‘African American Community Leaders’ Policy Recommendations for Reducing...
testimonials icon
My course is Finance for Health careThe 6th Home Work Assignment (HWA) is taken from the material in chapter 13 and 16...
testimonials icon
Information governance research paper 1 Your fi...
testimonials icon
"Financing Health Care in a Time of Insurance Restructuring" Please respond to the following: Analyze the impact of the ACA on...

Other samples, services and questions:

Calculate Price

When you use PaperHelp, you save one valuable — TIME

You can spend it for more important things than paper writing.

Approx. price
$65
Order a paper. Study better. Sleep tight. Calculate Price!
Created with Sketch.
Calculate Price
Approx. price
$65