Question

The following ratios are available for Leer Inc. and Stable
Inc.

Current Ratio |
Debt to Assets Ratio |
Earnings per Share |
||||

Leer Inc. | 2:1 | 75% | $3.50 | |||

Stable Inc. | 1.5:1 | 40% | $2.75 |

Compared to Stable Inc., Leer Inc. has

higher liquidity and lower solvency, but profitability cannot be compared based on information provided. |

higher liquidity, higher solvency, but profitability cannot be compared based on information provided. |

higher liquidity, lower solvency, and higher profitability. |

lower liquidity, higher solvency, and higher profitablility. |

Answer #1

Compared to Stable Inc., Leer Inc. has higher liquidity and
lower solvency, but profitability cannot be compared based on
information provided. |

Current Ratio measures liquidity. Higher Current Ratio indicates higher liquidity. |

Debt to Assets Ratio measures the proportion of debt to total assets. Higher Debt to Assets Ratio implies higher debt proportion and lower solvency. |

Earnings per Share cannot be used to measure profitability as companies may have different number of shares outstanding. |

Option a is correct |

Match each of the following ratios with the appropriate ratio
class (liquidity ratio, profitability ratio or solvency ratio)
Question 28 options:
123
Current ratio
123
Earnings per share
123
Quick ratio
123
Working capital
123
Asset turnover
123
Solvency ratio
1.
Liquidity ratio
2.
Profitability ratio
3.
Solvency ratio

For each of the following financial statement ratios, identify
whether the ratio provides analysis regarding a firms:
Profitability
Liquidity
Solvency
Common stockholder valuation
Earnings Per Share (EPS)
Quick ratio
Gross profit percentage (or margin)
Dividend Yield
Price to Earnings ratio
Accounts receivable turnover
Operating cash flow to current liabilities ratio
Days' sales in inventory
Debt to Equity ratio
Return on sales
Return on assets
Current ratio

1. A corporation reports the following balances and
amounts:
Accounts payable, $50,000
Cash provided by operations, $100,000
Accounts receivable, $35,000
Net income, $40,000
Average number of common shares, 15,000
Salaries and wages payable, $40,000
Average current liabilities, $225,000
Stockholders’ equity, $200,000
Average total assets, $600,000
Current assets, $300,000
Average total liabilities, $320,000
Current liabilities, $250,000
Dividends paid to preferred shareholders, $5,000
Determine its earnings per share?
Group...

Liquidity
Ratios:
- Working Capital:
$234,379
- Current Ratio:
1.34
- Inventory Turnover: 13.88
times
Solvency
Ratios:
- Debt to Asset Ratio:
75%
- Times Interest Earned:
2656
Profitability
Ratios:
- Gross Profit Rate:
50%
- Profit Margin:
17.7%
What accounting recommendations do you have for the new
company?
What business recommendations do you have to help the
new company?

Review the financial statements for Jones Inc. and the
comparative financial ratios for the year-end review. Enter your
calculations and written analysis directly into the template, and
show or explain your work where appropriate.
Problem 1. Calculate the firm's 2015 financial ratios for
liquidity, activity (asset management), leverage (debt), and
profitability.
Problem 2. Analyze the firm's performance from both time-series
and cross-sectional points of view using the key financial ratios
provided in the template.
Problems 1 and
2
BALANCE SHEET...

HF inc. has the following ratios:
-Current Ratio = 2.5
-Quick Ratio = 1.5
-Cash Ratio = .1
HF Inc. has TOTAL CURRENT ASSETS = $1,200.
*Please fill in the blanks for HF Inc.
Inventory (in dollars) $_________________________________
*Everything but Inventory and Cash
(in dollars) $____________________
PLEASE SHOW WORK TO EXPLAIN
Thank you

QUESTION 11
The debt-to-total assets ratio is primarily a measure of:
earnings-per-share
solvency
profitability
liquidity
QUESTION 12
Customer satisfaction would be found on:
the classified balance sheet.
not on any financial statement.
the multi-step income statement.
the statement of retained earnings
QUESTION 13
If total liabilities decreased by $25,000 and stockholders'
equity increased by $5,000 during a period of time, then total
assets must change by what amount and direction during that same
period?
$30,000 increase
$20,000 increase
$25,000 increase...

CLASS: Using Financial Ratios
LX Inc.
Rose Co
Current assets:
Cash
$ 29,200
$ 20,500
Short-term investments
42,000
22,200
Current receivables, net
38,000
44,000
Inventories
67,000
105,000
Prepaid expenses
2,000
4,300
Total current assets
$178,200
$196,000
Total assets
$300,000
$272,000
Total current liabilities
$105,000
$102,000
Total liabilities
$105,000
$136,000
Common stock:
$1 par (10,000 shares)
$ 10,000
$1 par (14,000 shares)
$ 14,000
Total stockholders’ equity
$195,000
$136,000
Total Liabilities and S/E
$300,000
$272,000
Market price per share
$ 80.00
$ 85.10...

Coca-Cola
Purpose Financial ratio analysis is one of the best techniques
for identifying and evaluating internal strengths and weaknesses.
Potential investors and current shareholders look closely at firms’
financial ratios, making detailed comparisons to industry averages
and to previous periods of time. Financial ratio analyses provide
vital input information for developing an IFE Matrix
Financial Ratios for Coca-Cola (2018)
Liquidity Ratios:
- Current ratio:
- Quick ratio:
Leverage Ratios:
- Debt-to-total-assets ratio:
- Debt-to-equity ratio:
- Long-term debt-to-equity ratio:
-...

Go to the Internet and find the following ratios for
McDonald Corporation (MCD). Give the source of your
information.
Ratio
Formula
Calculation
Ratio
Liquidity
Current
total current assets / total current liabilities
Quick, or Acid Test
(current assets - inventories) / current liabilities
Asset Management
Inventory Turnover
cost of goods sold / Inventories (average)
Days sales outstanding
Receivables / Sales per day
Fixed assets turnover
Annual sales / Net Fixed assets (average)
Total assets turnover
Annual sales / total assets...

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