Comprehensive Problem 1

Compute each of the following ratios for 2015 and 2016 and indicate whether each ratio was getting "better" or "worse from 2015 to 2016 and was "good" or "bad" when compared to the Industry Avg in 2016 (round all numbers to 2 digits past the decimal place) 2015 2016 Getting Better or Getting Worse? 2016 Industry Avg "Good" or "Bad" compared to Industry Avg Profit Margin 0.11 Current Ratio 1.90 Quick Ratio 1.12 Return on Assets .28 Debt to Assets .55 Receivables turnover 18.00 Avg. collection period* 21.20 Inventory Turnover* 8.25 Return on Equity 0.55 Times Interest Earned 11.15 Assume a 360 day year Inventory Turnover can be computed 2 different ways. Use the formula listed in the text