appendix 2: financial managerial accounting

Appendix Two (Benchmarking studies) Objective: To conduct ratio analysis of a comparable compamy (Waterloo Corporation) and compare with that of the industry. Methodology: - Based on the above information the consulting group will conduct ratio analpsis for the following ratios: Current ratio Recelvable's turnover Times's interest earned Profit margin Days in inventory Return on assets Cash current debt coverage ratio - As a next step the group will compare the ratios calculated above with industry benchmarksThe benchmarks are indicated within brackets besides each ratio. Current ratio ( 3 to 1 ) Receivable's turnover (13 times) Times's interest earned ( 9 times) Profit margin (126) Days in inventory (50 days) Return on assets (12\%) Cash current debt coverage ratio (2 times)