You are an independent financial analyst. In 2020, you have been asked to provide an independent assessment
Question:
You are an independent financial analyst. In 2020, you have been asked to provide an independent assessment of Yarmouk Public Limited Corporation. Yarmouk Corporation is specialized in the production of freshly imported farm products from Lebanon. The following ratios were provided to you with the following data for Yarmouk for three consecutive years and the industry index for year 2020.
Ratio | Year 2018 | Year 2019 | Year 2020 | Industry Indicator in Year 2020 |
Inventory Turnover | 32.25 | 42.42 | 62.65 | 53.25 |
Days’ sales in receivables | 94 | 98 | 113 | 130.25 |
Profit Margin | 0.06 | 0.07 | 0.082 | 0.075 |
Total Asset Turnover | 0.70 | 0.65 | 0.54 | 0.40 |
Quick Ratio | 1.029 | 1.03 | 1.028 | 1.031 |
Current Ratio | 1.15 | 1.21 | 1.33 | 1.25 |
Times Interest Earned | 4.45 | 4.375 | 0.9 | 4.65 |
Taking into consideration the above financial information and the industry type, you are required:
To analyze and explain Yarmouk Public Limited Corporation's liquidity status.
To analyze in depth the Corporation's asset management? Be as complete as possible given the above information, but do not use any irrelevant information.
Managerial Economics and Strategy
ISBN: 978-0321566447
1st edition
Authors: Jeffrey M. Perloff, James A. Brander