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Thorn Company: Ratio analysis

See attached file.

Use the financial statements for Thorn Company to calculate the following ratios for 2008 and 2007

a. working capital
b. current ratio
c. quick ratio
d. accounts receivable turnover (beginning receivables at Jan. 1, 2007, were 47,000).
e. average number of days to collect accounts receivable
f. Inventory turnover (beg. inventory at jan. 1, 2007, was 140,000).
g. average number of days to sell inventory.
h. debt to assets ratio
i. debt to equity ratio
j. times interest earned
k. plant assets to long-term debt
l. net margin
m. asset turnover
n. return on investment
o. return on equity
p. earnings per share
q. book value per share of common stock
r. price-earnings ratio (market price per share: 2007, 11.75; 2008, 12.50.
s. dividend yield on common stock.

check figures
k. 2008: 2.05: 1
p. 2007: $3.00

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Solution Summary

The solution computes various ratios for Thorn Company.
a. working capital
b. current ratio
c. quick ratio
d. accounts receivable turnover e. average number of days to collect accounts receivable
f. Inventory turnover
g. average number of days to sell inventory.
h. debt to assets ratio
i. debt to equity ratio
j. times interest earned
k. plant assets to long-term debt
l. net margin
m. asset turnover
n. return on investment
o. return on equity
p. earnings per share
q. book value per share of common stock
r. price-earnings ratio s. dividend yield on common stock.

$2.19