80.2K

Verified Solution

Link Copied!

hi. need the answer for this question

Assume that Farine Company has impressed you since you first heard of the company. You learn of a staff opening at Farine Company and decide to apply for it. Your resume is successfully screened from the hundred received and you advance to the interview process. You have been learn that the interview consists of analyzing the following financial facts and answering analysis questions. (Note: The data are taken from a small merchandiser in sports equipment) Sales Cost of goods sold Marketing and administrative expenses Net income 2021 111% 113% 108% 385% 2020 109% 111% 105% 128% 2019 112% 116% 104% 196% 2018 109% 111% 106% 116% Current ratio Acid-test ratio Inventory turnover ratio Account receivable turnover ratio Average collection period Asset turnover ratio Net Profit margin Return on assets Debt to assets ratio 2.4:1 0.8:1 7.5 times 6.7 times 54 days 2.6 times 32% 8.8% 42% 2.3:1 2.1:1 0.9:1 1:1 8.7 times 9.9 times 7.4 times 8.2 times 49 days 45 days 2.6 times 3.0 times 11% 16% 9.4% 11.1% 39% 2.0:1 1.3:1 10 times 9 times 41 days 3.2 times 10% 11.5% 42% 45% Required: Use the above data to answer each of the following questions with explanations. 1) Is it becoming easier for the Farine Company to meet its current liabilities on time and immediately? Explain. 2) Is the Farine Company collecting its account receivable more rapidly? Explain. 3) Comment on the change in the Farine Company's solvency during this period. 4) Comment on any significant changes across the years for the income statement trends of Farine Company

Answer & Explanation Solved by verified expert

See Answer