REQUIREMENTS1. Recommendation for company A2. Conclusion for company A COMPANY ARATIO20192018Liquidity1 Current Ratio0.671.072 Quick Ratio0.531.26Profitability3 ROE4 ROA5 GPM6 OPM7 NPMLeverage8 Debt Ratio9 Debt to Equity Ratio10 Time Interest Earned Ratio12.29% 15.60%3.43% 5.08%17.25% 18.78%3.90% 6.16%3.77% 4.99%72.08% 67.45%2.582.073.844.81Efficiency11 A/R Turnover Ratio12 Average Collection Period13 Inventory Turnover Ratio14 Average Age of Inventory15 Accounts Payable Ratio16 Average Age of Payable17 Operating Cycle18 Cash Conversion Cycle19 Total Asset Turnover Ratio20 Fixed Asset Turnover Ratio31.00 34.12121116.00 16.9322.50 21.274.744.9175.91 73.3634.11 31.82-41.80 -41.540.991.255.636.32

Liquidity ratio : These ratios is calculated for ascertaining the ability of paying the short…

Answered: REQUIREMENTS 1. Recommendation for…

Business

Accounting

REQUIREMENTS 1. Recommendation for company A 2. Conclusion for company A

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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Question

REQUIREMENTS

1. Recommendation for company A

2. Conclusion for company A

COMPANY A
RATIO
2019
2018
Liquidity
1 Current Ratio
0.67
1.07
2 Quick Ratio
0.53
1.26
Profitability
3 ROE
4 ROA
5 GPM
6 OPM
7 NPM
Leverage
8 Debt Ratio
9 Debt to Equity Ratio
10 Time Interest Earned Ratio
12.29% 15.60%
3.43% 5.08%
17.25% 18.78%
3.90% 6.16%
3.77% 4.99%
72.08% 67.45%
2.58
2.07
3.84
4.81
Efficiency
11 A/R Turnover Ratio
12 Average Collection Period
13 Inventory Turnover Ratio
14 Average Age of Inventory
15 Accounts Payable Ratio
16 Average Age of Payable
17 Operating Cycle
18 Cash Conversion Cycle
19 Total Asset Turnover Ratio
20 Fixed Asset Turnover Ratio
31.00 34.12
12
11
16.00 16.93
22.50 21.27
4.74
4.91
75.91 73.36
34.11 31.82
-41.80 -41.54
0.99
1.25
5.63
6.32

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