In your position as controller of Flashy Inc., a video production company, you are responsible for keeping the board of directors informed about the financial activities and status of the company. At the board meeting, you present the following report:

After the meeting is over, you overhear the company?s CEO holding a press conference with analysts in which she mentions the following ratios:

Required

1. Why do you think the CEO decided to report 4 ratios instead of all 11 of the ratios that you prepared?

2. Comment on the possible consequences of the CEO?s decision.

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2020 2019 2018 Net sales trend 147.00 135.00 100.00 10.1% 14.0% 15.6% Selling expenses to net sales Net sales to PPE assets. 3.8 to 1 3.6 to 1 3.3 to 1 Current ratio. 2.9 to 1 2.7 to 1 2.4 to 1 1.4 to 1 Quick ratio. 1.1 to 1 1.5 to 1 7.8 times 10.2 times Inventory turnover. 9.0 times Accounts receivable turnover 7.7 times 7.0 times 8.5 times Total asset turnover. 2.9 times 2.9 times 3.3 times Return on total assets. 10.4% 9.1% 9.7% Return on equity. 9.75% 11.50% 12.25% Profit margin. 3.6% 3.8% 4.0% 2020 2019 2018 100.00 135.00 14.0% Net sales trend Selling expenses to net sales. Net sales to PPE assets.. Current ratio. 147.00 10.1% 15.6% 3.8 to 1 2.9 to 1 3.6 to 1 2.7 to 1 3.3 to 1 2.4 to 1