Assume that you are Donna Jamison's assistant and that she has asked you to help her prepare a report that evaluates the company's financial condition. Answer the following questions:

What can you conclude about the company's financial condition from its statement of cash flows?

What is the purpose of financial ratio analysis, and what are the five major categories of ratios?

What are Computron's current and quick ratios? What do they tell you about the company's liquidity position?

What is Computron's inventory turnover, day's sales outstanding, fixed assets turnover and total assets turnover ratios? How does the firm's utilization of assets stack up against that of the industry?

What are the firm's debt, times-interest-earned, and fixed charge coverage ratios? How does Computron compare to the industry with respect to financial leverage? What conclusions can you draw from these ratios?