Acc 205 Week 5 Financial Ratios Uop Exam Assignment

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ACC 205 Week 5 Financial Ratios

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Individual Assignment - Financial Ratios

1.  Liquidity ratios. Edison, Stagg, and Thornton have the following financial information at the close of business on July 10:

Compute the current and quick ratios for each of the three companies. (Round calculations to two decimal places.) Which firm is the most liquid? Why?

2.  Computation and evaluation of activity ratios. The following data relate to Alaska Products, Inc:

Compute the accounts receivable and inventory turnover ratios for 19X5. Alaska rounds all calculations to two decimal places.

3.  Profitability ratios, trading on the equity. Digital Relay has both preferred and common  outstanding. The company reported the following information for 19X7:

Compute the gross profit margin ratio, the return on equity and the return on assets, rounding calculations to two decimal places. Does the firm have positive or negative financial leverage? Briefly explain.

4.  Horizontal analysis. Mary Lynn Corporation has been operating for several years. Selected data from the 20X1 and 20X2 financial statements follow.

Prepare a horizontal analysis for 20X1 and 20X2. Briefly comment on the of your work.

5.  Vertical analysis. Mary Lynn Corporation has been operating for several years. Selected data from the 20X1 and 20X2 financial statements follow.

Prepare a vertical analysis for 20X1 and 20X2. Briefly comment on the results of your work.

6. Ratio computation. The financial statements of the Lone Pine Company follow.

LONE PINE COMPANY

Statement of Income and Retained 

Instructions

Compute the following items for Lone Pine Company for 20X2, rounding all calculations to two decimal places when necessary:

a. Quick ratio

b. Current ratio

c. Inventory-turnover ratio

d. Accounts-receivable-turnover ratio

e....