BUSN 5200 Week 4 Homework Assignment

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Please complete the following for Joe’s Fly-By-Night Oil Company, whose financial statements are shown below:

 

 

Prepare a ratio analysis for the fiscal year ended Dec 31, 2012.  Organize your analysis per the following outline:

 

   (1) Liquidity

            - Current ratio

            - Quick ratio

        Comments on liquidity

 

   (2) Asset management

            - Total Asset turnover

            - Average collection period (ACP)

        Comments on asset management

 

   (3) Debt management

            - Debt ratio

            - Times interest earned

        Comments on debt management

 

   (4) Profitability

            - Net profit margin

            - Return on Assets (ROA)

            - Return on Equity (ROE)

            - Extended Du Pont equation

Comments on profitability to include your comments on the sources of ROE

revealed by the Du Pont equation

 

   (5) Market value ratios

            - PE ratio

            - Market to book ratio

     Comments on the market value ratios

 

For the purposes of this exercise, assume the following data for Joe’s Fly-By-Night Oil:

 

                  Stock price on Dec 31, 2012…$50.00

 

                  Number of common shares outstanding on Dec 31, 2012...1,000

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