Q no 3: Financial Statement analysis: Ratio analysisData for Lozano Chip Company and its industry averages follow. Calculate the indicated ratios forLozano.Lozano Chip Company: Balance Sheet as of December 31, 2016 (Thousandsof Dollars)CashReceivablesInventoriesTotal current assetsNet fixed assetsTotal assets$ 225,0001,575,0001.125,000$2,925.0001,350,000$4,275,000SalesCost of goods soldSelling, general, and administrative expensesEarnings before interest and taxes (EBIT)Accounts payableNotes payableOther current liabilitiesInterest expenseEarnings before taxes (EBT)Federal and state income taxes (40%)Net incomeTotal current liabilitiesLong-term debtCommon equityTotal liabilities and equity$ 601.866326.634525.000Lozano Chip Company: Income Statement for Year Ended December 31, 2016(Thousands of Dollars)$1.453,5001,068.7501.752.750$4.275,000$7,500.0006,375.000825,000$ 300.000111.631$ 188,36975.348$ 113,021Based on this information, compute (a) the current ratio, (b) the days sales outstanding (c) theinventory turnover ratio,(d) the debt to asset ratio (e) ROA and (f) ROE(01 each = 06)

Lozano Chip Company The current ratio = Current asset / Current liabilities = $2925000 / 1453500 =…

Answered: Based on this information, compute (a)…

Based on this information, compute (a) the current ratio, (b) the days sales outstanding (c) the inventory turnover ratio,(d) the debt to asset ratio (e) ROA and (f) ROE (01 each = 06)

Corporate Financial Accounting

14th Edition

ISBN:9781305653535

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter3: The Adjusting Process

Section: Chapter Questions

Problem 3.4ADM

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Question

Q no 3: Financial Statement analysis: Ratio analysis
Data for Lozano Chip Company and its industry averages follow. Calculate the indicated ratios for
Lozano.
Lozano Chip Company: Balance Sheet as of December 31, 2016 (Thousands
of Dollars)
Cash
Receivables
Inventories
Total current assets
Net fixed assets
Total assets
$ 225,000
1,575,000
1.125,000
$2,925.000
1,350,000
$4,275,000
Sales
Cost of goods sold
Selling, general, and administrative expenses
Earnings before interest and taxes (EBIT)
Accounts payable
Notes payable
Other current liabilities
Interest expense
Earnings before taxes (EBT)
Federal and state income taxes (40%)
Net income
Total current liabilities
Long-term debt
Common equity
Total liabilities and equity
$ 601.866
326.634
525.000
Lozano Chip Company: Income Statement for Year Ended December 31, 2016
(Thousands of Dollars)
$1.453,500
1,068.750
1.752.750
$4.275,000
$7,500.000
6,375.000
825,000
$ 300.000
111.631
$ 188,369
75.348
$ 113,021
Based on this information, compute (a) the current ratio, (b) the days sales outstanding (c) the
inventory turnover ratio,(d) the debt to asset ratio (e) ROA and (f) ROE
(01 each = 06)

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