A company has the following ratios: 2012 2013 Current ratio Debt ratio Cash coverage Inventory turns 2.4 0.6 5.6 3.2 2014 2.3 0.5 7.2 3.6 2.1 0.3 8.1 3.9 What is true of this company? a. Becoming more liquid evidenced by its cash coverage. b. Increasing its investment in inventory O c. Improving its ability to borrow d. Becoming less liquid as evidenced by its debt ratio

A company has the following ratios: 2012 2013 Current ratio Debt ratio Cash coverage Inventory turns 2.4 0.6 5.6 3.2 2014 2.3 0.5 7.2 3.6 2.1 0.3 8.1 3.9 What is true of this company? a. Becoming more liquid evidenced by its cash coverage. b. Increasing its investment in inventory O c. Improving its ability to borrow d. Becoming less liquid as evidenced by its debt ratio

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter5: Evaluating Operating And Financial Performance

Section: Chapter Questions

Problem 2EP

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Give typing answer with explanation and conclusion 27. EFN Define the following: S = Previous year’s sales A = Total assets E = Total equity g = Projected growth in sales PM = Profit margin b = Retention (plowback) ratio Assuming that all debt is constant, show that EFN can be written as EFN = −PM(S)b + [A − PM(S)b] × g Hint: Asset needs will equal A × g. The addition to retained earnings will equal PM(S)b × (1 + g).
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Choose the correct letter of answer and provide a solution. Thanks The financial ratios of a firm are as follows: Current Ratio=1.33; Acid-test ratio=0.80; Current liabilities=P40,000.00; Inventory turnover ratio=6 times. What is the sales/cost of good sold of the firm? *a. P57,200.00b. P77,200.00c. P97,20000d. P117,200.00e. P127,200.00
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Looking at Morningstars Profitability ratios, what has happened to Hewlett Packards profit margin (net margin %) over the past 10 years? What has happened to its return on assets (ROA) and return on equity (ROE) over the past 10 years?
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