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  • Gomez Business Finance Financial Ratios Financial Ratio Activity 1 FINAL Answer

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    Althea Janine Gomez
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    The document contains financial statements for a company in 2018 and 2019, including calculations of liquidity ratios, leverage ratios, and profitability ratios. It provides current assets, current liabilities, total assets, total liabilities, equity, sales, costs, operating income, interest expense, and net income for the company in those two years. The ratios show the company's ability to meet short-term obligations, its use of debt versus equity, and its profitability.

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    The document contains financial statements for a company in 2018 and 2019, including calculations of liquidity ratios, leverage ratios, and profitability ratios. It provides current assets, current liabilities, total assets, total liabilities, equity, sales, costs, operating income, interest expense, and net income for the company in those two years. The ratios show the company's ability to meet short-term obligations, its use of debt versus equity, and its profitability.

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    7 views2 pages

    Gomez Business Finance Financial Ratios Financial Ratio Activity 1 FINAL Answer

    Uploaded by

    Althea Janine Gomez
    The document contains financial statements for a company in 2018 and 2019, including calculations of liquidity ratios, leverage ratios, and profitability ratios. It provides current assets, current liabilities, total assets, total liabilities, equity, sales, costs, operating income, interest expense, and net income for the company in those two years. The ratios show the company's ability to meet short-term obligations, its use of debt versus equity, and its profitability.

    Copyright:

    © All Rights Reserved
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    NAME: Althea Janine P.

    Gomez
    SECTION: ABM 301
    ACTIVITY:

    Using the financial Statements below, compute for the liquidity ratio, leverage ratio and
    profitability ratio.
    Liquidity Ratio 2018 2019

    Current Assets 6,150,000 5,800,000 =1.0


    =1.0
    Current Ratio Current Liabilities 5,900,000 4 5,500,000 5

    Current Assets - 6,150,000 - 5,800,000


    Inventory - =0.8 - =0.8
    Quick Ratio 1,200,000
    Prepaid Utilities 3 1,100,000 5
          5,900,000
    Current Liabilities 5,500,000

    Leverage Ratio
    Total Liabilities 16,400,000 15,300,000 =0.4
    =0.46
    Debt Ratio Total Assets 35,700,000 33,600,000 6

    Total Equity 18,300,000 =0.5


    19,300,000
    Total Assets =0.54 33,600,000 4
    Equity Ratio 35,700,000
    Operating
    Income 8,300,000
    TIE Ratio =10.64
    Interest Expense 780,000

    Profitability Ratio
    45,000,000 -
    Gross Profit Margin Gross Profit 27,000,000 =0.40
    Net Sales 45,000,000

    Operating Profit 8,300,000


    Operating Profit Margin =0.18
    Net Sales 45,000,000

    Net Income 4,615,000


    =0.10
    Net Profit Margin Net Sales 45,000,000

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