As loan analyst for Shamrock Bank, you have been presented the following information. Toulouse Co. Lautrec Co.
Question:
As loan analyst for Shamrock Bank, you have been presented the following information.
Toulouse Co. | Lautrec Co. | |||||
---|---|---|---|---|---|---|
Assets | ||||||
Cash | $126,000 | $317,000 | ||||
Receivables | 213,000 | 316,000 | ||||
Inventories | 585,000 | 511,000 | ||||
Total current assets | 924,000 | 1,144,000 | ||||
Other assets | 522,000 | 631,000 | ||||
Total assets | $1,446,000 | $1,775,000 | ||||
Liabilities and Stockholders’ Equity | ||||||
Current liabilities | $292,000 | $357,000 | ||||
Long-term liabilities | 418,000 | 522,000 | ||||
Capital stock and retained earnings | 736,000 | 896,000 | ||||
Total liabilities and stockholders’ equity | $1,446,000 | $1,775,000 | ||||
Annual sales | $942,000 | $1,549,000 | ||||
Rate of gross profit on sales | 30 | % | 40 | % |
Each of these companies has requested a loan of $50,000 for 6 months with no collateral offered. Because your bank has reached its quota for loans of this type, only one of these requests is to be granted.
Compute the various ratios for each company. (Round answer to 2 decimal places, e.g. 2.25.)
Toulouse Co. | Lautrec Co. | |||||
---|---|---|---|---|---|---|
Current ratio | enter the ratio rounded to 2 decimal places | : 1 | enter the ratio rounded to 2 decimal places | : 1 | ||
Acid-test ratio | enter the ratio rounded to 2 decimal places | : 1 | enter the ratio rounded to 2 decimal places | : 1 | ||
Accounts receivable turnover | enter the accounts receivable turnover rounded to 2 decimal places | times | enter the accounts receivable turnover rounded to 2 decimal places | times | ||
Inventory turnover | enter the inventory turnover rounded to 2 decimal places | times | enter the inventory turnover rounded to 2 decimal places | times | ||
Cash to current liabilities | enter the ratio rounded to 2 decimal places | : 1 | enter the ratio rounded to 2 decimal places | : 1 |
Intermediate Accounting
ISBN: 978-1118147290
15th edition
Authors: Donald E. Kieso, Jerry J. Weygandt, and Terry D. Warfield