# Question

Refer to the financial statements for Groff Graphics Company in Problem 12-77B.

In problem Groff Graphics Company owns and operates a small chain of sportswear stores located near colleges and universities. Groff has experienced significant growth in recent years. The following data are available for Groff:

Groff Graphics Company

Consolidated Balance Sheets

(In thousands)

LIABILITIES AND STOCKHOLDERS’ EQUITY

Required:

1. Compute the asset efficiency ratios for Groff for 2011 and 2010 (in percentage terms, rounded to two decimal places) and determine whether their asset efficiency has changed.

2. Compute the profitability ratios (rounded to two decimal places) for Groff for 2011 and 2010. Determine by how much Groff’s profitability ratios have changed (in percentage terms, rounded to two decimal places) during the two-year period.

3. Compute the debt management ratios for 2010 and 2011. Discuss whether creditors are as secure in 2011 as they were in 2010.

In problem Groff Graphics Company owns and operates a small chain of sportswear stores located near colleges and universities. Groff has experienced significant growth in recent years. The following data are available for Groff:

Groff Graphics Company

Consolidated Balance Sheets

(In thousands)

LIABILITIES AND STOCKHOLDERS’ EQUITY

Required:

1. Compute the asset efficiency ratios for Groff for 2011 and 2010 (in percentage terms, rounded to two decimal places) and determine whether their asset efficiency has changed.

2. Compute the profitability ratios (rounded to two decimal places) for Groff for 2011 and 2010. Determine by how much Groff’s profitability ratios have changed (in percentage terms, rounded to two decimal places) during the two-year period.

3. Compute the debt management ratios for 2010 and 2011. Discuss whether creditors are as secure in 2011 as they were in 2010.

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