Question: 4 - 2 3 . RATIO ANALYSIS Data for Barry Computer Co . and its industry averages follow. The firm's debt is priced at par,
RATIO ANALYSIS Data for Barry Computer Co and its industry averages follow. The firm's debt is priced at par, so the market value of its debt equals its book value. Since dollars are in thousands, the number of shares is shown in thousands too.
a Calculate the indicated ratios for Barry.
b Construct the DuPont equation for both Barry and the industry.
c Outline Barry's strengths and weaknesses as revealed by your analysis.
d Suppose Barry had doubled its sales as well as its inventories, accounts receivable, and common equity during How would that information affect the validity of your ratio analysis? Hint: Think about averages and the effects of rapid growth on ratios if averages are not used. No calculations are needed.
Barry Computer Company:
Balance Sheet as of December in thousands
tableCash$Accounts payable,$
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