(a)
Efficiency ratio means:
The efficiency ratio is normally used to break down how well an organization utilizes its assets and liabilities inside. An efficiency ratio can figure the turnover of receivables, the reimbursement of liabilities, the amount and use of value, and the general utilization of stock and apparatus.
To compute:
Compute the assets efficiency ratios for Austin Logo Inc. for 2019 and 2018.
(b)
Profitability ratios are a class of budgetary measurements that are utilized to survey a business' capacity to create income in respect to its income, working costs, accounting report resources, and shareholders' equity after some time, utilizing information from a particular point in time.
To discuss:
Compute the profitability ratio for twisted for 2019 and 2018 also determine that how much Twised’s Profitability ratio changed or not.
(c)
A proportion of an organization’s debt to its absolute financing. The debt the board proportion estimates the amount of an organization’s tasks originates from debt rather than different types of financing, for example, stock or individual investment funds
To calculate:
Calculate the debt management ratios for twisted for 2018 and 2019. Discuss wether creditor are as secure in 2019 as they were in 2018.
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Cornerstones of Financial Accounting
- A Preparation of Ratios Refer to the financial statements for Burch Industries in Problem 12-89A and the following data. Required: 1. Prepare all the financial ratios for Burch for 2019 and 2018 (using percentage terms where appropriate and rounding all answers to two decimal places). 2. CONCEPTUAL CONNECTION Explain whether Burchs short-term liquidity is adequate. 3. CONCEPTUAL CONNECTION Discuss whether Burch uses its assets efficiently. 4. CONCEPTUAL CONNECTION Determine whether Burch is profitable. 5. CONCEPTUAL CONNECTION Discuss whether long-term creditors should regard Burch as a high-risk or a low-risk firm. 6. Perform a Dupont analysis (rounding to two decimal places) for 2018 and 2019.arrow_forwardAsset Efficiency Ratios Selected financial statement numbers for Rutherford Company follow. Required: 1. Using this information, calculate Rutherfords receivable turnover ratio (rounded to two decimal places.) 2. Using this information, calculate Rutherfords asset turnover ratio (rounded to two decimal places) and also convert the ratio into days (rounded to the nearest whole day).arrow_forwardAsset Efficiency Ratios Rumsford Inc.s financial statements for 2019 indicate the following account balances: Required: 1. Using this information, calculate Rumsfords receivable turnover ratio. (Note: Round to two decimal places.) 2. Using this information, calculate Rumsfords asset turnover ratio and also convert the ratio into days.arrow_forward
- Compare Dollar Tree and Dollar General The asset turnover ratios for two recent years for Dollar Tree, Inc. (DLTR) are shown in the Analysis for Decision Making section of this chapter. Using your results from MAD 5-2, compare and interpret the asset turnover ratios for Dollar Tree and Dollar General (DG).arrow_forwardAnalyze Home Depot The Home Depot (HD) reported the following data (in millions) in its recent financial statements: a. Determine the asset turnover ratio for Home Depot for Year 2 and Year 1. Round to two decimal places. b. What conclusions can be drawn from these ratios concerning the change in the ability of Home Depot to effectively use its assets to generate sales?arrow_forwardAsset Efficiency Ratios Refer to financial statements in Exercise 12-76 and the information below. Required: 1. Compute the three asset efficiency ratios (rounded to two decimal places) for 2018 and 2019. 2. Indicate the length of Steeles operating cycle in days (rounded to two decimal places) for the years ended December 31, 2019. and December 31, 2018.arrow_forward
- Review the select information for Bean Superstore and Legumes Plus (industry competitors), and then complete the following. A. Compute the accounts receivable turnover ratios for each company for 2018 and 2019. B. Compute the number of days sales in receivables ratios for each company for 2018 and 2019. C. Determine which company is the better investment and why. Round answers to two decimal places.arrow_forwardProfitability Ratios Tinker Corporation operates in the highly competitive consulting industry. Tinkers balance sheet indicates the following balances as of December 31, 2019. Required: Calculate Tinkers return on equity if Tinkers 2019 net income is $90,000.arrow_forwardUsing the following select financial statement information from Black Water Industries, compute the accounts receivable turnover ratios for 2018 and 2019 (round answers to two decimal places). What do the outcomes tell a potential investor about Black Water Industries?arrow_forward
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