RatioIndustry RatiosGnG Ratios1. Current Ratio5.37.082. Acid Test Ratio5.16.83. Gross Profit Ratio30%40%4. Net Income Margin7.5%18.2%5. Receivable Turnover Ratio914.416. Return on Asset Ratio12%9.29%7. Debt to Asset Ratio1:41 : 1 Interpretation and verbal analysis compared to industry ratios:1. Liquidity 2. Profitability 3. Solvency

Introduction:- Ratio analysis play vital role in comparison of company performance with industry…

Answered: Ratio Industry Ratios GnG Ratios 1.…

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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Ratio	Industry Ratios	GnG Ratios
1. Current Ratio	5.3	7.08
2. Acid Test Ratio	5.1	6.8
3. Gross Profit Ratio	30%	40%
4. Net Income Margin	7.5%	18.2%
5. Receivable Turnover Ratio	9	14.41
6. Return on Asset Ratio	12%	9.29%
7. Debt to Asset Ratio	1:4	1 : 1

Interpretation and verbal analysis compared to industry ratios:

1. Liquidity

2. Profitability

3. Solvency

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