Fix Ratios
tommyb1972
RatiosforResesachFinalPaperThesearetheonlyRatiosthatneedtobeonRepoort.docxModule 2 Quiz
Tommy Bush
February 9, 2022
Financial Ratios
Armour's 2019 annual report
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|
|
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1 |
Current assets |
$ 2,702, 209 |
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2 |
Current liability |
$ 1,422,009 |
|
3 |
Inventory |
$ 892,258 |
|
4 |
Net sales |
$ 5,267,132 |
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5 |
Average total assets |
$ 4,544,277 |
|
6 |
Costs of goods sold |
$ 2,796,599 |
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7 |
Average inventory |
$ 955,877 |
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8 |
Average accounts receivable |
$ 680,630 |
|
9 |
Total liabilities |
$ 2,693,444 |
|
10 |
Total assets |
$ 4,843,531 |
|
11 |
Earnings before interest and taxes |
$ 209,842 |
|
12 |
Interest expense |
$ 21,240 |
|
13 |
Net income |
$ 92,139 |
|
14 |
Sales or revenues |
$ 5,267132 |
|
15 |
Shareholders’ or owners’ equity |
$ 2,150,087 |
|
16 |
Price per share of common stock |
$ 0.0009 |
|
17 |
Number of outstanding shares |
$ 454,274 |
|
18 |
Earnings per share |
$ 0.2 |
LIQUIDITY RATIOS
Current Ratio
Current Ratio = current assets / current liabilities
= 2,702, 209 / 1,422,009
= 1.900
Quick Ratio
Quick Ratio = (current assets – inventory ) / current liabilities
=(2,702, 209 - 892,258) / 1,422,009
= 1.2728
Net working capital
Networking capital = current assets – current liabilities
= 2,702,209 - 1,422,009
= 1,280,200
ACTIVITY (EFFICIENCY) RATIOS
Total asset turnover
Total asset turnover = net sales / average total assets
= 5,267,132 / 4,544,277
= 1.1591
Inventory turnover
Inventory turnover = costs of goods sold / average inventory
= 2,796,599/ 955,877
=2.9257
Receivable turnover
Receivable turnover = revenues (net sales) / average accounts receivable
= 5,267,132 / 680,630
= 7.7386
FINANCIAL LEVERAGE (SOLVENCY) RATIOS
Debt (debt-asset)
Debt (debt-asset) = total liabilities / total assets
= 2,693,444 / ,843,531
= 3.1931
Debt-to-equity (D/E)
Debt-to-equity (D/E) = total liabilities / total shareholders’ equity
= 2,693,444 / 2,150,087
= 1.2527
Interest coverage
Interest coverage = earnings before interest and taxes / interest expense
= 209,842/ 21,240
= 9.8796
PROFITABILITY RATIOS
Net profit margin
Net profit margin = net income / sales or revenues
= 92,139/ 5,267132
= 0.017
Return on equity
Return on equity = net income / shareholders’ or owners’ equity
= 92,139/ 2,150,087
=0.0429
Return on assets
Return on assets = net income / total assets
= 92,139 / 4,843,531
= 0.0190
FIRM VALUATION (MARKET PROSPECT) RATIOS
Market value
Market value = price pre share of common stock × number of outstanding shares
= 92,139 / 454,274
= 0.2028
Price-to-earnings
Price-to-earnings = price per share of common stock / earnings per share Balance & Income
=0.0009/0.2
=0.00045
Earnings per share
Earnings per share = net income / number of outstanding shares of common stock
= 92,139 / 454,274
= 0.2028
