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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
the following for Joe s Fly-By-Night Oil Company, whose financial statements are shown below:
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Joe s Fly-By-Night Oil Company
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NET INCOME $1,800
Addition to retained earnings $1,200
Total assets $40,000
Â
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Prepare a ratio analysis for the fiscal year ended Dec 31, 2011. Organize your analysis per the following outline:
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(1) Liquidity
- Current ratio
- Quick ratio
Comments on liquidity
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(2) Asset management
- Total Asset turnover
- Average collection period (ACP)
Comments on asset management
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(3) Debt management
- Debt ratio
- Times interest earned
Comments on debt management
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(4) Profitability
- Net profit margin
- Return on Assets (ROA)
- Return on Equity (ROE)
- Extended Du Pont equation
Comments on profitability to include your comments on the sources of ROE
revealed by the Du Pont equation
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(5) Market value ratios
- PE ratio
- Market to book ratio
Comments on the market value ratios
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For the purposes of this exercise, assume the following data for Joe s Fly-By-Night Oil:
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Stock price on Dec 31, 2011 $50.00
Number of common shares outstanding on Dec 31, 2011...1,000
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