Rochester Corporation is engaged primarily in the business of manufacturing raincoats and umbrellas. Shown below are selected

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Rochester Corporation is engaged primarily in the business of manufacturing raincoats and umbrellas. Shown below are selected information from a recent annual report. (Dollar amounts are stated in thousands.)
Rochester Corporation is engaged primarily in the business of manufacturing

The company has long-term liabilities that bear interest at annual rates ranging from 8 percent to 12 percent.
Instructions
a. Compute the company's current ratio at (1) the beginning of the year and (2) the end of the year. (Carry to two decimal places.)
b. Compute the company's working capital at (1) the beginning of the year and (2) the end of the year. (Express dollar amounts in thousands.)
c. Is the company's short-term debt-paying ability improving or deteriorating?
d. Compute the company's (1) return on average total assets and (2) return on average stockholders' equity. (Round average assets and average equity to the nearest dollar and final computations to the nearest 1 percent.)
e. As an equity investor, do you think that Rochester's management is utilizing the company's resources in a reasonably efficient manner? Explain.

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Financial and Managerial Accounting the basis for business decisions

ISBN: 978-0078025778

17th edition

Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello

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