A company has positive NPV, IRR 21% & payback 3.15 yrs. By using the following financial...

Question

A company has positive NPV, IRR 21% & payback 3.15 yrs. By using the following financial ratios how the company financial feasibility and give the suggestions for future growth.

Liquidity/Financial Health 2019 2021 2022 2020 2023 Working Capital Current Assets 7,298.00 8,692.59 13,904.31 19,021.94 25,0 Days Sales Uncollected 3,393.12 Average Accounts Receivables 1,535.20 1,688.72 2,565.682,950.54 Net sales / Revernue 7,676.0 Debt to Equity Ratio Long-term debt Total equity (Unit: Times) 5,000.00 4,000.00 3,000.00 2,000.00 2,113.073,956.22 8,982.32 Return on Equity 1,113.071,843.16 5,026.10 5,883.16 7,039.29 2,113.073,956.22 8,982.32 14,865.48 21,704.77 32.43% Net income Liquiditv/Financial Health 2019 2020 4.70 4.39 2021 2022 2023 4.63 Current Ratio 5.48 5.93 7.48 5.02 3.50 5.22 Quick Ratiol A

Liquidity/Financial Health 2019 2021 2022 2020 2023 Working Capital Current Assets 7,298.00 8,692.59 13,904.31 19,021.94 25,028.21 1,329.93 1,851.37 3,007.00 3,211.473,348.44 5,968.07 6,841.22 10,897.31 15,810.47 21,679.77 Curent Liabilities Working capital Current Ratio Current Assets 7,298.00 8,692.59 13,904.31 19,021.9425,028.21 1,329.93 1,851.37 3,007.00 3,211.47 3,348.44 4.63 Curent Liabilities 4.70 5.93 (Unit: Times) 7.48 5.48 Quick Ratiol Acid-test Ratio Cash and cash equivalents 5,136.55 6,443.36 7,948.75 13,784.05 21,127.96 Short-term investments Receivables 1,535.20 1,688.72 2,565.68 2,950.543,393.12 1,329.93 1,851.37 3,007.00 3,211.47 3,348.44 3.50 Curent Liabilities 4.39 (Unit: Times) 5.02 5.22 7.33 2019 Efficiency Ratios 2021 2022 2020 2023 ACCounts Receivables Turnover Net sales / Revernue 7,676.00 8,443.60 12,828.42 14,752.68 16,965.59 1,535.20 1,688.72 2,565.682,950.543,393.12 Average Accounts Receivables (Unit: Times) 5.00 5.00 5.00 5.00 5.00

Days' Sales Uncollected 3,393.12 Average Accounts Receivables 1,535.20 1,688.72 2,565.682,950.54 Net sales / Revernue 7,676.00 8,443.60 12,828.42 14,752.68 16,965.59 365 365 365 365 365 Days in a year (Unit: Days) 73 73 73 73 73 Inventory Turnover 3,158.753,390.75 4,020.13 4,527.26 5,307.72 100.51 2,929.87 1,827.36 Cost of Goods Sold 166.25 47.13 Inventories 112.61 (Unit: Times) 19 33.74 1.37 2.48 Days' Sales in Invento 47.13 Inventories 100.51 2,929.87 1,827.36 3,158.75 3,390.75 4,020.13 4,527.265,307.7:2 365 166.25 Cost of Goods Sold 365 365 Days in a year (Unit: Days) 365 365 19 147 266 2019 2020 Leverage Analysis 2021 2022 2023 Debt Ratio Total liabilities 5,329.93 4,851.37 5,007.00 4,21147 3,348.44 7,443.00 8,807.59 13,989.31 19,076.94 25,053.21 Total assets (Unit: Percentage) 13% 55% 36% 22% 72% Financial Leverage Total assets 7,443.00 8,807.59 13,989.31 19,076.94 25,053.21 2,113.073,956.228,982.32 14,865.48 21,704.7'7 Total equity (Unit: Times) 3.52 2.23 1.56 1.15 1.28

Debt to Equity Ratio Long-term debt Total equity (Unit: Times) 5,000.00 4,000.00 3,000.00 2,000.00 2,113.073,956.22 8,982.32 14,865.48 21,704.77 2.37 1,000.00 1.01 0.05 0.34 0.14 2019 Profitability and Valuation ratios 2021 2022 2023 2020 Gross Margin Net sales / Revernue 7,676.00 8,443.60 12,828.42 14,752.68 16,965.59 3,158.753,390.754,020.13 4,527.265,307.72 58.85% Cost of sales 59.84% 68.66% 69.31% 68.71% (Unit: Percentage) Operating Margin Operating income (EBIT) 1,309.49 2,168.42 5,913.057,353.958,799.11 7,676.00 8,443.60 12,828.42 14,752.68 16,965.59 Net sales/Revernue (Unit: Percentage) 17.06% 25.68% 46.09% 49.85% 51.86% Net Margin Net income 1,113.071,843.16 5,026.105,883.16 7,039.29 7,676.00 8,443.60 12,828.4214,752.68 16,965.59 14.50% Net sales/Revernue 21.83% 39.18% 41.49% (Unit: Percentage) 39.88% Return on Assets (ROA Net income 1,113.071,843.16 5,026.105,883.16 7,039.29 7,443.00 8,807.59 13,989.31 19,076.94 25,053.21 Average total assets (Unit: Percentage) 30.84% 14.95% 20.93% 35.93% 28.10%

Return on Equity 1,113.071,843.16 5,026.10 5,883.16 7,039.29 2,113.073,956.22 8,982.32 14,865.48 21,704.77 32.43% Net income Total Equity (Unit: Percentage) 39.58% 52.68% 46.59% 55.96%

Liquiditv/Financial Health 2019 2020 4.70 4.39 2021 2022 2023 4.63 Current Ratio 5.48 5.93 7.48 5.02 3.50 5.22 Quick Ratiol Acid-test Ratio 7.33 Efficiency Ratios 5.00 5.00 5.00 5.00 5.00 Accounts Receivables Turnover Days' Sales Uncollected Inventory Turnover Days' Sales in Inventory 73 73 73 73 73 19 33.74 1.37 2.48 112.61 147 19 266 Leverage Analysis 13% Debt Ratio 72% 55% 36% 22% 3.52 Financial Leverage Debt to Equity Ratio 2.23 1.56 1.28 1.15 0.14 2.37 1.01 0.34 0.05 Profitability and Valuation ratios Gross Margin Operating Margin Net Margin Return on Assets (ROA) Return on Equity 58.85% 59.84% 68.66% 69.31% 68.71% 17.06% 25.68% 46.09% 49.85% 51.86% 14.50% 21.83% 39.18% 39.88% 41.49% 14.95% 20.93% 35.93% 30.84% 28.10% 52.68% 46.59% 55.96% 39.58% 32.43%

 · Answer

Answer: Ratio Analysis- Ratios are the indicators of company, ratio analysis provides financial and liquidity position of the company in short. Ratio analysis of the Company: Current ratio- This is the liquidity measure of company. If we see the ratios from 2019 to 2023, we see that current ratio is increasing, Higher current ratio is good for company. Quick ratio- This is also a liquidity measure, company's quick ratio is expected to increase in the coming years as well that is showing, company will maintain its liquidity position. Account receivable turnover ratio- This ratio tells the number of times, a company collects the payment from its customers. Company is maintaining a stable ratio in all throughout the coming years that is good. Inventory turnover ratio- This ratio tells the number of times, inventory is sold in a given period. If we see the figures, we see that in 2021, 2022 because of heavy inventories but in 2023, it is the highest. Debt ratio- This ratio tells the relationship between total liabilities and total assets, this ratio is decreasing in the coming years so it is a good sign, company is repaying its previous debt and debt is decreasing. Less debt is good because it decreases the obligation. Debt-Equity ratio- This ratio tells the relationship between total liabilities and total equity.The ratio is expected to come down because debt is coming down, it is a good sign for company. Lower debt is good. Gross, Operating and Net profit margin- These ratios tell the profitability of the company, if we analyse these ratios, we see that all three ratios are expected to increase in upcoming years that is a good sign for company, company will maintain its profitability in upcoming years as well. ROA & ROE- These are profitability measures. ROA and ROE are going up in 2020 and 2021 but in 2022 and 2023, they are decreasing because net income is increasing with lower percentage. Conclusion- Overall financial health of company is good, company will do well in future also, it is a growing company whose sales and profit are increasing and it is able to maintain sound liquidity position. Its activity position is also good, business will do good in future. Company is also cutting debt in its capital structure in the future that is a good sign..

A company has positive NPV, IRR 21% & payback 3.15 yrs. By using the following financial...

Question:

Answers

Similar Solved Questions

Questions 27 and 28 are connected. 27. These questions were motivated by the articles about the...

Is this correct? on a 2.00 kg particle with an initial speed of 4.00. m/s. What...

I=2 j=0 while(i!=len(data)): if(data[i][0][0]>="A" and data[i][0][0]<="E" and data[i][1]=="Mammal"): print(data[i][0]) i=i+1 Could you explain what the first...

Applications 25. Resource Allocation You manage an ice cream factory that makes two flavors: Creamy Vanilla...

How do you do this? ilitary service 10. [LO 11.2] The TRICARE health care program is...

How do you solve #x^2 = 2x + 15#?

Question 9 (2 points) According to "Ape Genius," researchers at Max Planck set up an experiment...

Part A In preparing students to write a chemical equation, we often use analogies. Let's write...

How many 12-note “songs” can be made from the notes A, B, C, and F?

CSePub Home Book Store nstructors Independent AuthorsA make hisla嗑cortotton her 1 tartday the can earn 12...

Ill. Find the period. -> y = Sin (24) ces (be) + cas (24) Chin (6x)

What do my percentages tell me about the gc anaylsis thay i ran pece Analysis T...

An ideal gas initially at 265 K undergoes an isobaric expansion at 2.50 kPa. The volume...

For my lab a 50g mass is on a spring. The spring is pulled down a...

3. How many milliliters of a 10% (m/v) glucose solution are required to supply 100 g...

Asic Statistics Bag 1 contains 5 red balls and 3 black balls. Bag 2 contains a...

POLYSTYRENE: 1. Describe the resin before adding the polymerization catalyst. 2. What is the principle component...