Use the financial ratios of company A and company B to answer the questions below.                                                                 Company A                     Company B                                                             Yr t+1   Year t                 Yr t+1   Year t Current ratio                                        0.55       0.59                   0.56       0.55 Accounts receivable turnover              6.22       6.25                   5.06       4.87 Debt to total assets                               40.5%    40%                   67.8%     65.9% Times interest earned                           8.80       30.6                   5.97       6.33 Free cash flows (in millions)           ($3,819)   $3,173                 $168      $550 Return on stockholders’equity             7.7%      7.7%                  26.6%      23.3% Return on assets                                   4.3%      4.3%                  8.9%       7.9% Profit margin…

8. Financial Ratios. Consider this simplified balance sheet for Geomorph Trading: (LO4-3) Current assets $100 Current liabilities $ 60 Long-term assets 500 Long-term debt 280 Other liabilities 70 Equity 190 $600 $800 a. What is the company's debt-equity ratio? b. What is the ratio of total long-term debt to total long-term capital? c. What is its net working capital?

Question 8: You are provided with the Income Statement and the Balance Sheet of HTS software, Inc. for 2011. Required:  (a) Calculate the ratios stated in the table below for HTS Software, Inc. for 2011  (b) Analyze the current financial position for the company from a time series and cross section    viewpoint.  (c) Break your analysis into an evaluation of the firm’s liquidity, activity, debt, profitability and market ratios. Historical and Industry Average Ratios HTS Software ,   Inc. Ratio 2010 2011 Industry2011 Current Ratio 2.6 — 2.7 Quick Ratio 1.8 — 1.75 Inventory Turnover 4.5 — 4.7 Average Collection Period 40days — 42 days Total Asset Turnover 1.2 — 1 Debt Ratio 20% — 21% Times Interest Earned 9 — 8.9 Gross Profit Margin 43% — 44% Operating Profit Margin 30% — 32% Net Profit Margin 20% — 21% Return on total assets 12% — 13% Return on Equity…

Problem 11 (Current Ratio) The Artist Company has P1,312,500 in current assets and P525,000 in current liabilities. Its initial inventory level is P375,000 and it will raise funds as additional notes payable and use them to increase inventory. How much can its short-term debt (notes payable) increase without pushing its current ratio below 2.0?

14-7 You are a business analyst with a big investment bank, and you are evaluating the equity risk, business risk, and financial risk of Abilon's Inc. You went online and found that the industry consensus on Abilon's equity risk is 1.5. You also know that the company's debt-equity ratio is 1. What is Abilon's estimated business and financial risk based on the model βA(1 + D/E)? Select one: a. 0.5; 1 b. 0.5; 2 c. 0.75 and 0.5 d. 0.75 and 0.75 e. 1 and 1

RATIO ANALYSIS The Corrigan Corporations 2015 and 2016 financial statements follow, along with some industry average ratios. a. Assess Corrigans liquidity position, and determine how it compares with peers and how the liquidity position has changed over time. b. Assess Corrigans asset management position, and determine how it compares with peers and how its asset management efficiency has changed over time. c. Assess Corrigans debt management position, and determine how it compares with peers and how its debt management has changed over time. d. Assess Corrigans profitability ratios, and determine how they compare with peers and how its profitability position has changed over time. e. Assess Corrigans market value ratios, and determine how its valuation compares with peers and how it has changed over time. f. Calculate Corrigans ROE as well as the industry average KOE, using the DuPont equation. From this analysis, how does Corrigans financial position compare with the industry average numbers? g. What do you think would happen to its ratios if the company initiated cost-cutting measures that allowed it to hold lower levels of inventory and substantially decreased the cost of goods sold? No calculations are necessary. Think about which ratios would be affected by changes in these two accounts. Corrigan Corporation: Balance Sheets as of December 31 2016 2015 Cash 72,000 65,000 Accounts receivable 439,000 328,000 Inventories 894,000 813,000 Total current assets 1,405,000 1,206,000 Land and building 238,000 271,000 Machinery 132,000 133,000 Other fixed assets 61,000 57,000 Total assets 1,836,000 1,667,000 Accounts payable 80,000 72,708 Accrued liabilities 45,010 40,880 Notes payable 476,990 457,912 Total current liabilities 602,000 571,500 Long-term debt 404,290 258,898 Common stock 575,000 575,000 Retained earnings 254,710 261,602 Total liabilities and equity 1,836,000 1,667,000 Corrigan Corporation: Income Statements for Years Ending December 31 2016 2015 Sales 4,240,000 3,635,000 Cost of goods sold 3,680,000 2,980,000 Cross operating profit 560,000 655,000 General administrative and selling expenses 303,320 297,550 Depreciation 159,000 154,500 EBIT 97,680 202,950 Interest 67,000 43,000 Earnings before taxes (EBT) 30,680 159,950 Taxes (40%) 12,272 63,980 Net income 18,408 95,970 Per-Share Data 2016 2015 EPS 0.80 4.17 Cash dividends 1.10 0.95 Market price (average) 12.34 23.57 P/E ratio 15.42 5.65 Number of shares outstanding 23,000 23,000 Industry Financial Ratiosa 2016 Current ratio 2.7 Inventory turnoverb 7.0 Days sales outstandingc 32.0 days Fixed assets turnoverb 13.0 Total assets turnoverb 2.6 Return on assets 9.1% Return on equity 18.2% Return on invested capital 14.5% Profit margin 3.5% Debt-to-capital ratio 50.0% P/E ratio 6.0 aIndustry average ratios have been constant for the past 4 years. bbased on year-end balance sheet figures. cCalculation is based on a 365-day year.

If given the opportunity, in which of the firms would you invest based on the result of your analysis of both companies and the comparison with the industry? If you would not invest, explain your reasons according to the results obtained. Company Name:   Year 2018 Chemicals and Allied Products Industry Ratios  ………….. Solvency or Debt Ratios Merck J&J 2018 Debt ratio  0.67  0.61 0.47 Debt-to-equity ratio  0.93  0.51 0.38 Interest coverage ratio  12.27  18.91 -9.43 Liquidity Ratios       Current ratio  1.17   1.47 3.47 Quick ratio  0.92   1.16 2.12 Cash ratio  0.40   0.63 2.24 Profitability Ratios       Profit margin  14.64%   18.75% -93.4% ROE (Return on equity), after tax  23.03%   25.60% -248.5 ROA (Return on assets)  7.49%   10.00% -146.5 Gross margin  68.06%   66.79% 55.3% Operating margin (Return on sales)  19.62%   24.27%…

Use the following ratios from Walmart, Target, and Dollar General to answer Questions 12-13. Ratio Liabilities-to-equity ratio Times interest earned Cash from operations to total debt Walmart 1.246 11.49 0.787 Target O Target O Walmart O This cannot be determined based on the information given O Dollar General 1.275 15.11 0.447 Dollar General 1.17 7.85 0.974 Based on the information given, which of the three companies is better able to cover its interest expense with current income? 3.33 pts

5:33 What is the firm's equity multiplier? The equity multiplier is given by: 1 1 - Debt Ratio (DuPont analysis) Garwryk, Inc., which is financed with debt and equity, presently has a debt ratio of 78 percent. What is the firm's equity multiplier? How is the equity multiplier related to the firm's use of debt financing (i.e., if the firm increased its use of debt financing would this increase or decrease its equity multiplier)? Explain. Equity Multiplier = The equity multiplier is ||| = (Round to two decimal places.) VO) 1 LTE2.II 4G O 45%