Financial Analysis

10. Basic growth ratio-2. Find the missing data, b C I P/O rate 40% P/E rate 8 40% Yield rate 12% 80% Retention rate 25% Required: Compute the unknown value in each of the independent cases. 1 Payout ratio and retention rate b. Price-earnings ratio and retention rate Hint: P/O rate = P/E Rate x Yield Rate C. Payout rate and yield rate Retention Rate = 100% - P/O Rate Basic Liquidity ratios. You are been asked by the Chief Financial Officer of Kwing Corporation to analyze its liquidity position in 2012. You have gathered the following data from the records of the company and industry published reports (in thousands): Kwing Corp. Industry Average Average cash P 3,500 P 2,000 Average trade receivables 8,000 10,000 Average inventory 6,500 7,000 Average trade payables 14,000 12,000 Net cash sales 20,000 25,000 Net credit sales 200.000 150,000 Cost of sales 130,000 112,000 Net credit purchases 140,000 96,000 The company uses a 360-day a year base. The credit terms offered to customers are 2/10, n/40. Suppliers give credit terms of 3/20. n/40. Required: For Kwing Corporation and the industry, compute the following: a. Receivable turnover b. Collection period C. Inventory turnover Inventory days (Days to sell inventory) Payable turnover Payment period Operating cycle Net cash cycle Net working capital Working capital turnover Current ratio Acid-test (quick-assets) ratio