Assignment 3: Ratio Analysissolve 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 Wednesday, November 5, 2015.Balance Sheet as of December 31, 2010Gary and CompanyCash $45 Accounts payables $45Receivables 66 Notes payables 45Inventory 159 Other current liabilities 21Marketable securities 33 Total current liabilities $111Total current assets $303Net fixed assets 147 Long Term LiabilitiesTotal Assets $450 Long-term debt 24Total Liabilities $135Owners EquityCommon stock $114Retained earnings 201Total stockholders? equity 315Total liabilities and equity $450Income Statement Year 2010Net sales $795Cost of goods sold 660Gross profit 135Selling expenses 73.5Depreciation 12EBIT 49.5Interest expense 4.5EBT 45Taxes (40%) 18Net income 271. 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 16XInventory turnover 10XFixed asset turnover 2XTotal asset turnover 3XCurrent ratio 2XQuick ratio 1.5XTimes interest earned 7X2. 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 PointsHas correctly calculated the ratios. 40Has correctly analyzed and interpreted the significance of the resulting ratios and suggested actions for improvement. 40Wrote in a clear, concise, and organized manner; demonstrated ethical scholarship in accurate representation and attribution of sources; displayed accurate spelling, grammar, and punctuation 20Total: 100!
Welcome to Vision Essays! For over 10 years we have been helping students like you write, research, and generate ideas for their research papers, essays, term papers, dissertations, editing, resumes, and any other type of work your learning institution may assign you.
We can write any paper and have flexible payment plans with a minimum deadline of 6 Hrs.