Case Study Analysis Discussion—SMH Liquidity, Debt, and Operating Ratios

In this assignment, you will calculate ratios and analyze the data collected in 
M1: Assignment 2. You will compare ratios from the SMH data to ratios calculated from the comparative facilities.

Measure the liquidity, debt, and operating ratios of the FP and NFP organizations, particularly the following:

1. Liquidity
   
   • Current ratio
   • Acid test ratio
2. Operating performance
   
   • Return on assets
   • Operating profit total and percentage
   • Investment yield
   • Return on equity
3. Management efficiency
   
   • Days in accounts receivable (AR)
   • Days inventory on hand
   • Days cash on hand

Use an Excel spreadsheet that you downloaded in M1: Assignment 2, to create tables to compare the data from SMH to the data from the other facilities. You will use two years of data for comparison. Present data for each of the above categories on one sheet. Ensure that all formulas are included in the calculations. The facilitator will review both the accuracy of the data and the efficient use of Excel.

For more help with calculations, you can use the following Web site:

• Investopedia. (2009). Financial terms. Retrieved March 10, 2009, fromhttp://www.investopedia.com/terms/g/?viewed=1