Question Details

FINANCIAL STATEMENT ANALYSIS
Analyzing Financial Statements 
Select two competing companies (publicly traded) to analyze for the most recent year financial data is available. Compute the following liquidity ratios for each of the companies, and comment on the relative liquidity of the two competitors. (1) Current ratio (2) Receivables turnover (3) Average collection period (4) Inventory turnover (5) Days in inventory (6) Current cash debt coverage ii) Compute the following solvency ratios for each of the companies, and comment on the relative solvency of the two competitors. (1) Debt-to-total-assets ratio (2) Times interest earned (3) Cash debt coverage ratio (4) Free cash flow iii) Compute the following profitability ratios for each of the companies, and comment on the relative profitability of the two competitors. (1) Profit margin (2) Asset turnover (3) Return on assets (4) Return on common stockholders' equity iv) Which of the two companies would you prefer to invest in? Why, and under what circumstances? Explain. Assure that your comments and analysis are written in APA format



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