The objective of this study is to carry out the ratio analysis of the company between 2009 and 2011.
Current Ratio
The current ratio assesses a company ability settle its short-term obligations. A current ratio below 1 reveals that the company is not in good financial health. Overview of the current ratio of the company reveals that it is in good financial health and will be able to settle its short-term obligation because its current ratio between 2007 and 2011 is more than 2 despite that the company current ratio was decreasing between 2007 and 2011.
Quick Ratio
The quick ratio is the ability of a company to meet its short-term obligation. However, quick ratio excludes the inventories. Analysis of the company quick ratio reveals that the company's quick ratio is decreasing between 2007 and 2011 from 1.64 to 0.97.
Times Interest Earned
This is a tool to measure a company ability to meet its debt obligation. However, the company Times Interest Earned is decreasing from 5.60 in 2007 to 3.50 in 2011 revealing that the company is a good position to settle its debt.
Account Receivable Turnover
Accounts receivable turnover measures the number of times a company collects its accounts receivable in a given year. The company Account Receivable Turnover declines from 5.60 in 2007 to 4.20 in 2011.
Days to Collect Receivables
Days to Collect Receivables is the number of days a company receives payments owed them.The company number days to collect account in a year increased...
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