River Valley Production Inc. seeks to increase its market share and improve its results. The company takes as a starting point the current scenario and the results obtained in 2018 and 2019. Like other companies, River Valley uses financial ratios (ratios) as tools for analyzing the results obtained at the end of the period. Consider the data presented in the financial statements below and analyze the company's results based on the financial ratios.
|
|
2018 |
2019 |
|
Cash |
$63,000 |
$201,000 |
|
Accounts Receivable |
199,000 |
305,000 |
|
Marketable Securities |
81,000 |
42,000 |
|
Inventories |
441,000 |
455,000 |
|
Prepaids |
5,000 |
9,000 |
|
Total Current Assets |
789,000 |
1,012,000 |
|
Property, Plant, and Equipment, net |
858,000 |
858,000 |
|
Total Assets |
$1,647,000 |
$1,870,000 |
|
|
|
|
|
Account Payable |
$150,000 |
$100,000 |
|
Accruals |
101,000 |
95,000 |
|
Total Current Liabilities |
$251,000 |
$195,000 |
|
Bonds Payable |
405,000 |
575,000 |
|
Total Liabilities |
656,000 |
770,000 |
|
|
|
|
|
Common Stocks |
700,000 |
700,000 |
|
|
291,000 |
400,000 |
|
Total |
991,000 |
1,100,000 |
|
Total Liabilities & Equity |
$1,647,000 |
$1,870,000 |
|
Income Statement |
2018 |
2019 |
|
Sales |
$1,855,000 |
$2,150,000 |
|
Cost of Goods Sold |
823,000 |
985,000 |
|
Gross Profit |
1,032,000 |
1,165,000 |
|
Selling, General & Admin. Exp. (SG&A) |
520,000 |
438,000 |
|
|
75,000 |
150,000 |
|
Earnings before Interest and Taxes (EBIT) |
437,000 |
577,000 |
|
Interest Expense |
38,000 |
45,000 |
|
Earnings before Taxes (EBT) |
399,000 |
532,000 |
|
Taxes (35%) |
139,650 |
186,200 |
|
Net Income |
$259,350 |
$345,800 |
|
Datos por acción |
2018 |
2019 |
|
Earning per Share (EPS) |
$1.25 |
$3.00 |
|
Cash Dividends |
$1.15 |
$2.10 |
|
Market Share (Price) |
$8.00 |
$11.00 |
|
Ratio Price/Earning (P/E) |
15.20 veces |
8.03 veces |
|
Outstanding Shares |
25,000 |
25,000 |
|
Razones financieras de la industria |
2019 |
|
Current Ratio |
8.3 veces |
|
Quick Ratio (Acid Test) |
8.1 veces |
|
Inventory Turnover Ratio |
7 |
|
Days Sales Outstanding (DSO) |
30 días |
|
Assets Turnover Ratio |
12 veces |
|
|
8.1 |
|
|
17.25% |
|
|
15.5% |
|
Profit Margin |
3.3% |
|
Debt/Equity Ratio |
50% |
|
Price /Earning Ratio (P/E) |
5.1 veces |
Please I need help determining the following:
1.7 Return on Equity (ROE)
1.8 Return on Investment (ROI)
1.9 Profit Margin
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