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Assignment

The document provides financial statements for XYZ Company for the years 2001 and 2000. Students are asked to calculate and interpret various ratios for XYZ Company using the financial information, including current ratio, acid test ratio, inventory turnover ratio, receivables turnover ratio, total asset turnover ratio, equity-turnover ratio, debt-ratio, debt-to equity ratio, equity –multiplier ratio, time –interest earning ratio, coverage ratio, gross-profit margin, net-profit margin, operational profit margin, return on investment ratio, return on equity ratio, earnings per share, dividend per share, price earnings ratio, and market to book value ratio.

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28 views3 pages

Assignment

The document provides financial statements for XYZ Company for the years 2001 and 2000. Students are asked to calculate and interpret various ratios for XYZ Company using the financial information, including current ratio, acid test ratio, inventory turnover ratio, receivables turnover ratio, total asset turnover ratio, equity-turnover ratio, debt-ratio, debt-to equity ratio, equity –multiplier ratio, time –interest earning ratio, coverage ratio, gross-profit margin, net-profit margin, operational profit margin, return on investment ratio, return on equity ratio, earnings per share, dividend per share, price earnings ratio, and market to book value ratio.

Uploaded by

ililyeshetu116
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Unity University

College of Business, Economics and Social Sciences.


Group Assignment one (max 15, min 10 point)
Last Submission date will be on Tuesday April 23, 2024
Dear Students! Let us use the financial statements of XYZ Company, shown below to investigate and explain
ratio analysis.
XYZ Company, Income Statements
Variables 2001 2000
Sales 3,074,000 2,567,000
Less Cost of Goods Sold 2,088,000 1,711,000
Gross Profit 986,000 856,000
Less Operating Expenses
Selling Expenses 100,000 108,000
General and Adm. Expenses 468,000 445,000
Total Operating Expenses 568,000 553,000
Operating Profit 418,000 303,000
Less Interest Expenses 93,000 91,000
Net Profit Before Tax 325,000 212,000
Less Profit Tax (at 29%) 94,250 61,480
Net Income After Tax 230,750 150,520
Less Preferred Stock Dividends 10,000 10,000
Earnings Available to Common 220,750 140,520
Shareholders
EPS 2.90 1.81

XYZ, Balance Sheets


2001 2000
Assets
Current Assets
Cash 363,000 288,000

1|Page
Marketable Securities 68,000 51,000
Accounts Receivables 503,000 365,000
Inventories 289,000 300,000
Total Current Assets 1,223,000 1,004,000
Gross Fixed Assets (at cost)
Land and Buildings 2,072,000 1,903,000
Machinery and Equipment 1,866,000 1,693,000
Furniture and Fixture 358,000 316,000
Vehicles 275,000 314,000
Others 98,000 96,000
Total Fixed Assets 4,669,000 4,322,000
Less Acc. Depreciation 2,295,000 2,056,000
Net Fixed Assets 2,374,000 2,266,000
Total Assets 3,597,000 3,270,000
Liabilities and Owners' Equity
Current Liabilities
Accounts Payable 382,000 270,000
Notes Payable 79,000 99,000
Accruals 159,000 114,000
Total Current Liabilities 620,000 483,000
Long-Term Debts 1,023,000 967,000
Total Liabilities 1,643,000 1,450,000
Shareholder's Equity
Preferred Stock –Cumulative, 2000 Share issued and 200,000 200,000
Outstanding
Common Stock, Shares issued and Outstanding in 2001, 191,000 190,000
76,262; in 2000, 76,244
Paid- in Capital in Excess of Par on Common Stock 428,000 418,000
Retained Earnings 1,135,000 1,012,000
Total Stockholders' Equity 1,954,000 1,820,000
Total Liabilities and Stockholders' Equity 3,597,000 3,270,000

2|Page
Required: - Based on the above information compute and interpret for XYZ Company the following ratios?
A. Current ratio
B. Acid test ratio
C. Inventory turnover ratio
D. Receivable turnover ratio
E. Total asset turnover ratio
F. Equity-turnover ratio
G. Debt-ratio
H. Debt-to equity ratio
I. Equity –multiplier ratio
J. Time –interest earning ratio
K. Coverage ratio
L. Gross-profit margin
M. Net-profit margin
N. Operational profit margin
O. Return on investment ratio
P. Return on equity ratio
Q. Earnings per share
R. Dividend per share
S. Price earnings ratio
T. Market to book value ratio

3|Page

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