Course Code: Week # Week Name

AC2799: Module 4 Depreciation and Ratio Analysis

Course Code: Week # Week Name

Submission Requirements: Submit the completed assessment as a Word document.

• ? Font: Arial, 12 point
• ? Line spacing: Double

AC2799: Module 4 Depreciation and Ratio Analysis Analysis 4.2 Ratio Analysis You are provided with the data as below: 2010 Ratio 2010 2009 2008 Industry Average Long-term debt 0.45 0.40 0.35 0.35 Inventory turnover 62.65 42.42 32.25 53.25 Depreciation/total assets 0.25 0.014 0.018 0.015 Days' sales in receivables 113 98 94 130.25 Debt to equity 0.75 0.85 0.90 0.88 Profit margin 0.082 0.07 0.06 0.075 Total asset turnover 0.54 0.65 0.70 0.40 Quick ratio 1.028 1.03 1.029 1.031 Current ratio 1.33 1.21 1.15 1.25 Times interest earned 0.9 4.375 4.45 4.65 Equity multiplier 1.75 1.85 1.90 1.88 Referring to the given data, the CEO of WQY Inc. wrote, \"2008 was a good year for the firm with respect to our ability to meet our short-term obligations. We had higher liquidity largely due to an increase in highly liquid current assets (cash, account receivables, and short-term marketable securities).\" 1 AC2799: Module 4 Depreciation and Ratio Analysis Analysis 4.2 Ratio Analysis Do you think the CEO is correct in making this statement? Explain your stand and use only the given data for your analysis. Submission Requirements: Submit the completed assessment as a Word document. Font: Arial, 12 point Line spacing: Double Evaluation Criteria: The analysis rubric will be used to evaluate this assessment. 2