You are considering investing in the Swisher Ltd. and to make your deasion you have obtained...

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You are considering investing in the Swisher Ltd. and to make your deasion you have obtained the following financial information: Current Year Preceding Year Balance Sheet 28,000 $ 10,000 $ Cash 32,000 Short-term investments $ 17,000 Accounts receivables 5,000 $ 8,000 Prepaid Expenses 300 $ 6,000 $ 49,300 $ 2,500 4,500 64,000 Inventory Total Current Assets Total Long-Tem Assets 80,000 $ 129,300 $ 82,000 Total Assets 146,000 Accounts Payable 25,000 $ 23,000 Accrued Liabilities 7,500 9,000 39,500 9,000 $ Salary Payable Total Current Liabilities 7,000 $ 41,000 $ Income Statement Net Sales Revenues 88,000 Cost of Goods Sold 57,000 Operating Expenses *interest expense included in 15,300 operating expenses 3,000 The industry averages for certain ratios are as follows: Industry Benchmarks Current Ratio 1.35 Acid test quick ratio 110 Inventory Turnover 9.00 Accounts Receivable Turnover Return on Total Assets 7.00 12.00% Gross Profit Percentage Return on Net Sales 30.00% 17.00% %24 %24 Required Complete the following ratio analysis for the current year to determine if this would be a good company to invest in. When making your decision consider the company's liquidity, profitability, and ability to effectively use assets compared to the industry. Would you invest in this company? 1. Current Ratio 2. Quick (acid-test) ratio 3. Inventory Turnover 4. Accounts Receivable Turnover 5. Return on Total Assets 6. Gross Profit Percentage 7. Return on Net Sales You are considering investing in the Swisher Ltd. and to make your deasion you have obtained the following financial information: Current Year Preceding Year Balance Sheet 28,000 $ 10,000 $ Cash 32,000 Short-term investments $ 17,000 Accounts receivables 5,000 $ 8,000 Prepaid Expenses 300 $ 6,000 $ 49,300 $ 2,500 4,500 64,000 Inventory Total Current Assets Total Long-Tem Assets 80,000 $ 129,300 $ 82,000 Total Assets 146,000 Accounts Payable 25,000 $ 23,000 Accrued Liabilities 7,500 9,000 39,500 9,000 $ Salary Payable Total Current Liabilities 7,000 $ 41,000 $ Income Statement Net Sales Revenues 88,000 Cost of Goods Sold 57,000 Operating Expenses *interest expense included in 15,300 operating expenses 3,000 The industry averages for certain ratios are as follows: Industry Benchmarks Current Ratio 1.35 Acid test quick ratio 110 Inventory Turnover 9.00 Accounts Receivable Turnover Return on Total Assets 7.00 12.00% Gross Profit Percentage Return on Net Sales 30.00% 17.00% %24 %24 Required Complete the following ratio analysis for the current year to determine if this would be a good company to invest in. When making your decision consider the company's liquidity, profitability, and ability to effectively use assets compared to the industry. Would you invest in this company? 1. Current Ratio 2. Quick (acid-test) ratio 3. Inventory Turnover 4. Accounts Receivable Turnover 5. Return on Total Assets 6. Gross Profit Percentage 7. Return on Net Sales

Answer rating: 100% (QA)

Current year ratio analysis 1 Current rat... View the full answer