Cango Week 3 Financial

Green boxes to be filled in by instructor

Ratio Formula (express the ratio in words) Detailed calculation (actual numbers from financial statements used for the calculation) Final number (final result of the detailed calculation) Explanation of why ratio is important Earned points (up to 3 points per "box"/cell) Instructor feedback

Example: Term A/Term B (Term A divided by Term B) 1000/2000 .50 This is the explanation of the role of this ratio and why it is important 3

Efficiency Ratio: Receivables Turnover Net Sales Revenue/Accounts Receivable 50,000,000/33,000,000 1.52 Measures ability to collect cash from credit customers

Grade for above 3.0 3.0 3.0 3.0 12.0

Efficiency Ratio: Inventory Turnover Cost of Goods Sold/Total Inventory 9,000,000/32,000,000 0.28 Represents how quickly inventory is moved

Grade for above 3.0 3.0 3.0 3.0 12.0

Financial Leverage Ratio: Debt/Equity Ratio Total Liabilities/Shareholders Equity 94,900,000/141,000,000 0.67 Shows percentage of debt financing to equity financing. If there is a high ratio, then there is a high financial risk

Grade for above 3.0 3.0 3.0 3.0 12.0

Liquidity Ratio: Current Ratio Total Current Assets/Total Current Liabilities 202,020,000/37,500,000 5.39 Shows companys ability to pay current liability with current assets

Grade for above 3.0 3.0 3.0 3.0 12.0

Liquidity Ratio: Quick Ratio (Total Current Assets-Total Inventory)/Total Current Liabilities 170,020,000/37,500,000 4.53 Measures if company can pay its liability if it were all due immediately

Grade for above 3.0 3.0 3.0 3.0 12.0

Liquidity: Working Capital Total Current Asstets-Total Current Liabilities 202,020,000-37,500,000 164520000 Shows company's ability to pay its debts

Grade for above 3.0 3.0 3.0 3.0 12.0

Profitability Ratio: Return on Assets Net Income/Total Liabilities and Owners Equity 5,486,000/235,900,000 2.33% Shows how much net income was generated for each $1 of assets the company has

Grade for above 3.0 3.0...