Financial Performance Evaluation

HCS/385

Mason Medical

Balance Sheet          31-Dec-14                  31-Dec-13

Cash                      $52,000                              $60,000

Accounts Receivable 198,000                                   80,000

Marketable Securities 80,000                                    40,000

Inventories        440,000                                                360,000

Prepaids      3,000                                                                     7,000

  Total Current Assets 773,000                                   547,000

Property, Plant, and Equipment, net857,000       853,000

  Total Assets $1,630,000                                   $1,400,000

                        ===========                         ===========

Current Liabilities $240,000                       $160,000

Bonds Payable 400,000                                 400,000

Common Equity 990,000                              840,000

  Total Liabilities & Equity $1,630,000     $1,400,000

=========== ===========

  

Income Statement 2014                      2013

Sales                     $1,640,000                     $1,574,000

  Cost of Goods Sold 800,000            725,000

Gross Profit       840,000                 849,000

SG&A                       440,000                    430,000

Interest Expense    40,000                   25,000

  Net Income $360,000                      $394,000

=========== ===========

Key Ratios                                  2014                                  Industry Avg

Current Ratio                                                                                   2.883

Acid Test (Quick Ratio)                                                            0.973

Debt to Asset                                                                                      0.447

Receivable Turnover                                                                     13.492

Inventory Turnover                                                                        2.630

Net Profit Margin                                                                        0.176

Asset Turnover                                                                                1.357

Return on Assets                                                                                  18%

Return on Equity                                                                                   22%

Complete the financial ratio exercises in the Ratio Analysis Spreadsheet. 

Write a 750- to 1,050-word paper in which you summarize the financial performance of the organization. Explain how the ratios are calculated and how the results impact the organization. In addition, explain how the organization is performing compared to the industry averages. Provide rationale using data from the exercises. 

Cite 3 peer-reviewed, scholarly, or similar references to support your paper.