Question 2 (4 Marks) Case 1 The Majid Company provided the following selected financial data: 2,019 2,018 Cash 20,000 32,000 Accounts receivable 34,000 45,000 32,000 Inventory 2,000 Investments 65,000 Current assets 162,000 80,000 15,000 83,000 97,000 Building Total Assets 242,000 180,000 Current Liabilities 120,000 90,000 Total liabilities 160,000 140,000 40,000 Total equity 82,000 Total equity and Liabilities 242,000 180,000 Sales 120,000 110,000 Cost of goods sold 100,000 64,000 Net income 22,000 8,000 1. Calculate the following ratios, 2. Determine if the ratio is favorable or un-favorable 3. Compare the ratio to the Industry ratio provided and comment which ratio is better the Company (C) or the Industry (). Quick Ratio Receivables turnover Days sales outstanding - Inventory turnover Current assets - inventory / current liabilities Sales / Average accounts receivable 365 / receivables turnover Cost of goods sold / Average Inventory Total liabilities / total equity Total liabilities / total assets Net Income sales Debt to equity - Debt to total assets = Profit margin on sales - Answer AR Debt to total Profit margin Days sales outstanding Inventory turnover Debt to equity assets on sales Quick Ratio Turnover Company Industry Best