1. Compute the following ratios for both companies for the current year and decide which company’s stock better fits your investment strategy. a. Quick ratio b. Debt ratio c. Interest coverage ratio d. Accounts receivable turnover e. Inventory turnover f. Total assets turnover g. Return on assets h. Return on equity i. Earnings per share j. Price-earnings ratio

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Chapter 12, Problem 35AP

To determine

1.

Compute the following ratios for both companies for the current year and decide which company’s stock better fits your investment strategy.

a. Quick ratio

b. Debt ratio

c. Interest coverage ratio

d. Accounts receivable turnover

e. Inventory turnover

f. Total assets turnover

g. Return on assets

h. Return on equity

i. Earnings per share

j. Price-earnings ratio

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