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Final Project Ratios

Final Project Ratios. Jeremiah Lynch Computer Applications And Accounting Dr. James Borden. Division A. Division A Points. Current Ration of 1.39… Close to the goal of 2 to 1 Firm is paying of the debt well Quick of 0.34, also positive of debt payback

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Final Project Ratios

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  1. Final Project Ratios Jeremiah Lynch Computer Applications And Accounting Dr. James Borden

  2. Division A

  3. Division A Points • Current Ration of 1.39… • Close to the goal of 2 to 1 • Firm is paying of the debt well • Quick of 0.34, also positive of debt payback • Debt to Asset of .187.., low likely to pay debt • Positive Return of Sales, signifies positive profit, maybe its too low • Average Collection of 311.., little large • May be cutting cash flow, or never collect (weakness) • Average days inventory of 0.18, a little low • Might not be able to get more inventory

  4. Division B

  5. Division B Points • Current Ratio is strong, 1.8.., goal of 2 • Fairly Strong of 0.4.., want 1, not great • Low Debt to Assets, ability to pay debt • Return on Sales somewhat low • Decent Average Collection Period, not cutting cash flow • Average days inventory low, can’t get more

  6. Division C

  7. Division C Points • Good Current Ratio of 1.7..(2), close • Strong Quick Ratio, close to 1 • Higher Debt to Assets, look at debt payoff • Low Return on Sales, profit low? • High Average Collection Period, • Cut cash flow, may never collect • Average days inventory low, can’t attain

  8. Consolidated Ratios

  9. Consolidated Points • Current Ratio that is too high (2) • Quick Ratio that is also to big • Large Debt to Assets, look at Debt Payoff • Decent return on sale in Comparison • Large Average Collection Period, cut cash flow, may never collect • Decent average days inventory

  10. Ratio Chart

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