a)Required:i)J.P. Robard Manufacturing CompanyIncome Statement for the Year Ended December 31, 2021ItemNet salesCost of goods soldGross profitOperating expenses (includes $500 depreciation)ii)Net operating incomeInterest expenseEarnings before taxesIncome taxes (40%)Net income+iii)iv) Day sales outstanding($ in thousands)8,000Calculate the following ratios from the above informations:Profit marginInventory turnoverCurrent ratio3,3004,7003,0001,7003671,333533800b) i. Analyse firm performance based on ratios as in (a) and compare with an industry ratiosas stated below.Profit margin = 30%Inventory turnover = 20 timesCurent ratio = 5 timesDay sales ou anding = 20 daysii) What is the strength and weaknesses of the firm (if any)? Elaborate.+c) Recommend to the management how to improve the firm performance. The balance sheet and income statement for J. P. RObard Manufatcuring Company are asfollows:ItemCashJ.P. Robard Manufacturing CompanyBalance Sheet as at 31 December 2021($ in thousands)500Account receivableInventoryTotal current assetsNet fixed assetsTotal assetsAccounts payableAccrued expensesShort-term notes payableTotal curernt liabilitiesLong-term debtTotal common equityTotal liabilities and equity2,0001,0003,5004,5008,0001,1006003002,0002,0004.0008,000

Lets understand the basics. Profit margin ratio is also known as net profit ratio. This ratio shows…

J.P. Robard Manufacturing Company Income Statement for the Year Ended December 31, 2021 ($ in thousands) 8,000 3,300 4,700 3,000 1,700 367 1,333 533 800 Item Net sales Cost of goods sold Gross profit Operating expenses (includes $500 depreciation) Net operating income Interest expense Earnings before taxes Income taxes (40%) Net income +

J.P. Robard Manufacturing Company Income Statement for the Year Ended December 31, 2021 ($ in thousands) 8,000 3,300 4,700 3,000 1,700 367 1,333 533 800 Item Net sales Cost of goods sold Gross profit Operating expenses (includes $500 depreciation) Net operating income Interest expense Earnings before taxes Income taxes (40%) Net income +

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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