You are a loan officer for White Sands Bank of Taos. Paul Jason, president of P. Jason
Question:
___________________________2019 2018
Current ratio...........................3.1..................2.1
Asset turnover.........................2.8..................2.2
Net income.......................Up 32%.............Down 8%
Earnings per share..................$3.30...............$2.50
Jason is a very insistent (some would say pushy) man. When you told him that you would need additional information before making your decision, he acted offended and said, "What more could you possibly want to know?" You responded that, at a minimum, you would need complete, audited financial statements.
Instructions
With the class divided into groups, answer the following.
(a) Explain why you would want the financial statements to be audited.
(b) Discuss the implications of the ratios provided for the lending decision you are to make. That is, does the information paint a favorable picture? Are these ratios relevant to the decision?
(c) List three other ratios that you would want to calculate for this company, and explain why you would use each.
Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Related Book For
Financial Accounting
ISBN: 978-1119305736
10th edition
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel
Question Posted: