Company ABC has the following information. Please calculate the Z-core for 2021 and 2022 and provide a comment on its performance.Variables20222021X1(net working capital /total asset)0.560.175X2(retained earnings/total asset)-0.120.08X3(EBIT/total assets)0.560.69X4(market value of equity/book value of total liability)1.20.96X5(sales/total asset)0.780.63Z-score (1.2X1+1.4X2+3.3X3+0.6X4+1X5)3.8523.805

Given information: The values of X1, X2, X3, X4, and X5 for years 2021 and 2022 are given.

Answered: Company ABC has the following…

Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018

18th Edition

ISBN:9780079039897

Author:Carter

Publisher:Carter

Chapter7: Exponents And Exponential Functions

Section: Chapter Questions

Problem 68SGR

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Variables	2022	2021
X1(net working capital /total asset)	0.56	0.175
X2(retained earnings/total asset)	-0.12	0.08
X3(EBIT/total assets)	0.56	0.69
X4(market value of equity/book value of total liability)	1.2	0.96
X5(sales/total asset)	0.78	0.63
Z-score (1.2X1+1.4X2+3.3X3+0.6X4+1X5)	3.852	3.805