Assignment 2 This assignment may be completed on an individual basis or in a group of 2 students. Copying someone else's work and submitting it is a form of academic dishonesty and will result in a grade of 0. DUE DATE: April 8.2022 Your friend, Abu, has come to you for some assistance in evaluating a company he is considering investing in. Abu has provided you with the income statement, balance sheet and statement of cash flows for the year ended December 31, 2021 as well as some industry standards for select ratios. Abu knows you have taken a financial accounting course & is hoping you can help him decide whether or not he should invest in the company. Required: 1. Calculate 12 ratios to help you analyze the company. 2. Review the Statement of Cash Flows for Genie's Carpets and describe 3 strengths or weaknesses. 3. Based on your answers from Part 1 and 2 would you recommend Abu invests in the company. You must discuss at least 4 ratios in providing your answer. SHOW YOUR WORK Industry averages-2021 55.00% 7.00% Gross profit margin ratio Net profit margin ratio Rate of return on assets 3% Earnings per Share $ 10.00 Current ratio Dividend Yield 1.60 0.11:1 Assignment 2 This assignment may be completed on an individual basis or in a group of 2 students. Copying someone else's work and submitting it is a form of academic dishonesty and will result in a grade of 0. DUE DATE: April 8.2022 Your friend, Abu, has come to you for some assistance in evaluating a company he is considering investing in. Abu has provided you with the income statement, balance sheet and statement of cash flows for the year ended December 31, 2021 as well as some industry standards for select ratios. Abu knows you have taken a financial accounting course & is hoping you can help him decide whether or not he should invest in the company. Required: 1. Calculate 12 ratios to help you analyze the company. 2. Review the Statement of Cash Flows for Genie's Carpets and describe 3 strengths or weaknesses. 3. Based on your answers from Part 1 and 2 would you recommend Abu invests in the company. You must discuss at least 4 ratios in providing your answer. SHOW YOUR WORK Industry averages-2021 55.00% 7.00% Gross profit margin ratio Net profit margin ratio Rate of return on assets 3% Earnings per Share $ 10.00 Current ratio Dividend Yield 1.60 0.11:1 GENIE'S CARPETS UMITED STATEMENT OF CASH FLOWS YEAR ENDING DECEMBER 31, 2021 2021 2020 Cash flow from operating activities Net Income 105,848 $ 97,420 Add depreciation 7,400 5,400 Adjustment to reconcile net income to net cash provided by operating activities Net increase in current assets other than cash 39,250 13,940 Net increase in current liabilities 22,610 32,840 96,608 121,720 Cash flow from Financing activities Payment of dividends 25,000 20,000 New loan proceeds Repayment of loans: 89,000 5,000 4,000 59,000 24,000 Cash flow from investing activities Purchase of land and building 100,000 Net cash inflow 55,608 97,720 Beginning cash 122,190 24,470 Ending cash 177,798 $ 122,190 Selected data from the December 31, 2019 financial statements: Accounts receivable Inventory Accounts payable Total assel's Shareholder equity $ 77,600 $ 89,760 $ 157,800 S 219.130 S 19.150 Additional information: Market price per share December 31, 2021 $ 20.00 Market price per share December 31, 2020 $ 15.00 Number of shares outstanding 10.000 No preferred shares