EXERCISE

Financial Data for years ending: (In thousands and CAD)

ASSETS	2010	2011	2012
Fixed Assets	100,000	127,000	170,000
Inventory*	45,000	55,000	74,000
Accounts Receivables (A/R)	45,000	66,000	80,000
Cash	32,500	62,600	87,600
Total assets	222,500	310,600	411,600

*Average inventory levels represent 80% of the year-end levels due to

seasonal production

LIABILITIES & EQUITY	2010	2011	2012
Retained earnings (accumulated)	42,500	99,600	170,600
Owners equity	90,000	90,000	90,000
Long term debt	0	0	0
Account payables (A/P)	54,000	77,000	96,000
Bank line of credit	36,000	45,000	55,000
Equity and Liabilities	222,500	310,600	411,600

INCOME STATEMENT	2010	2011	2012
Sales	350,000	400,000	500,000
Costs of goods sold	220,000	250,000	310,000
Gross profit	130,000	150,000	190,000
Overhead	30,000	30,000	40,000
Interest	5,000	7,000	10,000
Depreciation	10,000	10,000	10,000
Earnings	85,000	103,000	130,000
Income Tax	22,500	30,900	39,000
Net profit	62,500	72,100	91,000
Dividends	10,000	15,000	20,000

WORKSHEET

Ratio Analysis

MEASURE	2010	2011	2012	Industry Average	Comments
Performance
Return on Equity -%				32%
Gross profit margin -%				32%
Net profit margin - %				18%
Liquidity
Current ratio				1.3
Quick ratio				1.0
Efficiency
A/R days collected				60
A/P days payable				90
Leverage
Debt/Total Assets				.60
Debt/Equity				1.1

Assume all the sales during the year are credit sales.