Using the financial statements below, calculate the indicated financial ratios for the Harold Company and compare them with the industry norms. Indicate “Yes” if Harold Company's performance in 2021 is better than the industry norms; indicate “NO” if the performance is not better. Assume a 360-day year.

  

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Assets Cash & marketable securities Accounts receivable Inventory Net fixed assets Total Assets Harold Company Balance Sheet December 31, 2021 Liabilities and Shareholders Equity Accounts payable Notes payable Other current liabilities Long-term debt Total liabilities Shareholders equity Total Income Statement Data: Sales Cost of goods sold Selling, general and administrative expenses Depreciation expense Earnings before interest and taxes (EBIT) P 144,000 288,000 432,000 936,000 P1,800,000 P 144,000 72,000 198,000 414,000 828,000 972,000 P1,800,000 P2,200,000 1,496,000 440,000 44,000 220,000 Interest expense Taxes on income Transfer to the worksheet as indicated: Ratios, A, B, C Ratios 1. Current ratio 2. Quick ratio 3. Total asset turnover 4. Average collection period 5. Average payment period 6. Inventory turnover 7. Total liabilities to total assets 8. Times interest earned 9. EBIT/sales 10. Return on equity Industry Harold Norms COMP. A B 2.0 0.9 1.6 times 30.0 days 30.0 days 5.0 times .33 20.0 times .12 .158 22,000 79,200 Better? C Assets Cash & marketable securities Accounts receivable Inventory Net fixed assets Total Assets Harold Company Balance Sheet December 31, 2021 Liabilities and Shareholders Equity Accounts payable Notes payable Other current liabilities Long-term debt Total liabilities Shareholders equity Total Income Statement Data: Sales Cost of goods sold Selling, general and administrative expenses Depreciation expense Earnings before interest and taxes (EBIT) P 144,000 288,000 432,000 936,000 P1,800,000 P 144,000 72,000 198,000 414,000 828,000 972,000 P1,800,000 P2,200,000 1,496,000 440,000 44,000 220,000 Interest expense Taxes on income Transfer to the worksheet as indicated: Ratios, A, B, C Ratios 1. Current ratio 2. Quick ratio 3. Total asset turnover 4. Average collection period 5. Average payment period 6. Inventory turnover 7. Total liabilities to total assets 8. Times interest earned 9. EBIT/sales 10. Return on equity Industry Harold Norms COMP. A B 2.0 0.9 1.6 times 30.0 days 30.0 days 5.0 times .33 20.0 times .12 .158 22,000 79,200 Better? C

Answer rating: 100% (QA)

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