Use Star Inc.'s financial statements to compute the required ratios below, and indicate whether the change...

 

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Use Star Inc.'s financial statements to compute the required ratios below, and indicate whether the change from year to year is favourable or unfavourable. For your analysis, assume tha all other things have remained constant. Apply your analysis in very general terms. All values should be accurate to at least two decimal places. Star Inc. Income Statement For Years Ended December 31, 2014, 2013, and 2012 2014 2013 2012 $1,749,300 $1,619,300 $1,404,600 1,163,400 1,258,600 1,139,500 Sales Cost of goods sold... Gross profit from sales. Operating expenses. Income from operations. Interest expense Income before taxes, Income taxes Net income. Cash Short-term investments Accounts receivable, net Merchandise inventory. Prepaid expenses. Notes receivable, due in 2017. Plant assets, net Total assets. Star Inc. Balance Sheet December 31, 2014, 2013, and 2012 Assets Liabilities and Equity Accounts payable Salaries payable... Income taxes payable. 585,900 360,700 265,100 218,800 196,700 178,600 367,100 164,000 86,500 1,800 2,250 2,500 365,300 161,750 84,000 44,700 19,900 20,500 $320,600 $141,850 $63,500 Long-term note payable secured by mortgage on plant assets Share capital, 200,000 shares. Retained earnings Total liabilities and equity... Ratio Times interest earned ratio. Debt ratio (%)... Equity ratio (%).. Number of days of sales in inventory.... Current ratio 2014 2013 2014 2013 2012 $41,900 $50,400 $56,800 8,000 10,000 12,000 40,700 41,200 41,700 74,100 88,900 92,900 3,700 3,900 4,400 12,500 13,500 13,500 153,000 157,000 162,000 $333,900 $364,900 $383,300 $12,200 $15,200 $13,700 17,000 15,900 16,100 20,000 17,800 15,950 51,000 43,000 40,000 220,000 250,000 220,000 13,700 23,000 77,550 $333,900 $364,900 $383,300 Analysis (select one) (select one) (select one) (select one) (select one) Actiunto Windowe Use Star Inc.'s financial statements to compute the required ratios below, and indicate whether the change from year to year is favourable or unfavourable. For your analysis, assume tha all other things have remained constant. Apply your analysis in very general terms. All values should be accurate to at least two decimal places. Star Inc. Income Statement For Years Ended December 31, 2014, 2013, and 2012 2014 2013 2012 $1,749,300 $1,619,300 $1,404,600 1,163,400 1,258,600 1,139,500 Sales Cost of goods sold... Gross profit from sales. Operating expenses. Income from operations. Interest expense Income before taxes, Income taxes Net income. Cash Short-term investments Accounts receivable, net Merchandise inventory. Prepaid expenses. Notes receivable, due in 2017. Plant assets, net Total assets. Star Inc. Balance Sheet December 31, 2014, 2013, and 2012 Assets Liabilities and Equity Accounts payable Salaries payable... Income taxes payable. 585,900 360,700 265,100 218,800 196,700 178,600 367,100 164,000 86,500 1,800 2,250 2,500 365,300 161,750 84,000 44,700 19,900 20,500 $320,600 $141,850 $63,500 Long-term note payable secured by mortgage on plant assets Share capital, 200,000 shares. Retained earnings Total liabilities and equity... Ratio Times interest earned ratio. Debt ratio (%)... Equity ratio (%).. Number of days of sales in inventory.... Current ratio 2014 2013 2014 2013 2012 $41,900 $50,400 $56,800 8,000 10,000 12,000 40,700 41,200 41,700 74,100 88,900 92,900 3,700 3,900 4,400 12,500 13,500 13,500 153,000 157,000 162,000 $333,900 $364,900 $383,300 $12,200 $15,200 $13,700 17,000 15,900 16,100 20,000 17,800 15,950 51,000 43,000 40,000 220,000 250,000 220,000 13,700 23,000 77,550 $333,900 $364,900 $383,300 Analysis (select one) (select one) (select one) (select one) (select one) Actiunto Windowe

Answer rating: 100% (QA)

Ratio 2014 2013 Analysis Times interest earned ratio 20394 7289 Favourable Debt ratio 015 012 Unfavourable Equity ratio 070 075 Unfavourable Number of days of sales in inventory 2325 2578 Favourable C... View the full answer