Financial Statement Ratio Analysis The following information (in $000) has been obtained from Diamond Limiteds...
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Accounting
Financial Statement Ratio Analysis
The following information (in $000) has been obtained from Diamond Limiteds financial statements for the fiscal years ending December 31.
2020 2019 2018
Total assets $738 $583 $514
Current liabilities 78 71 93
Total liabilities 229 164 169
Total shareholders equity 494 427 387
Income before taxes 87 63 56
Interest expense 10 6 5
Net cash provided by operating activities 117 99 99
Net income 62 49 53
Number of common shares outstanding 67 77 73
Taken from stock market at Dec. 31 $16.3 $12.44 $11.7
Market price per share (not in $000)
There are no preferred shares issued by Diamond.
REQUIRED: Show all calculations. Round all calculations to two decimal places. Use appropriate units for each ratio calculation.
A. Calculate the following items for Diamond Limited for fiscal years 2019 and 2020:
i) Current cash debt coverage ratio
ii) Cash debt coverage ratio
iii) Rate of return on assets
iv) Earnings per share
v) Price earnings ratio
vi) Times interest earned
B. Comment on whether there has been improvement or deterioration from 2019 to 2020 in the ratios calculated. Take the perspective of Diamonds management. Briefly explain.
.
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