Griffin and Lasky Inc G L supplies industrial automation equipment and
Griffin and Lasky, Inc. (G&L), supplies industrial automation equipment and machine tools to the automotive industry. G&L uses the percentage of completion method for recognizing revenue on its long-term contracts. Customer orders have long lead times because they involve multiyear capital investment programs. Sometimes orders are canceled. Selected items from the company’s financial statements follow.


Required:
1. Compute earnings before interest, taxes, depreciation, and amortization (EBITDA) and adjusted EBITDA—after excluding the plant write-down—for each year in the schedule.
2. Are profits at G&L keeping pace with sales?
3. Compute the day’s receivables outstanding using year-end receivables for each year in the schedule.
4. Why might analysts be concerned about earnings quality atG&L?
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