Part 1: Financial Information (2 pages, plus Excel spreadsheet)
Calculate the following ratios for the Barry Computer Company using the Excel spreadsheet provided.
Ratio Calculation
Current Current Assets/Current Liabilities
Quick Current Assets Inventories/Current Liabilities
Days Sales Outstanding Receivables/(Annual Sales/365)
Inventory Turnover Sales/Inventories
Total Assets Turnover Sales/Total Assets
Profit Margin Net Income/Sales
ROA Net Income/Total Assets
ROE Net Income/Common Equity
ROIC EBIT(1 T)/Total Invested Capital
TIE EBIT/Interest Charges
Debt/Total Capital Total Debt/(Total Debt + Equity)
M/B Market Price/Book Value
P/E Price per Share/Earnings per Share
EV/EBITDA (Market Value of Equity + Market Value of Total Debt +
Market Value of Other Financial Claims Cash and Equivalents)/EBITDA
1. Analyze computations to determine which ratios are above and below their industry averages, and for each, provide a brief explanation as to why that might be the case.
2. Evaluate the financial health of the organization, including in what areas the organization could improve.