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Assessing Martin Manufacturing's Current Financial Position: Calculate ratios, liquidity, activity, debt, profitability, market

See attached for pages 86-88 to assess the case of Martin Manufacturing's current financial position.

a. Calculate the firm's 2006 financial ratios, and then fill in the preceding table. (Assume a 365-day year.)
b. Analyze the firm's current financial position from both a cross-sectional and a time-series viewpoint. Break your analysis into evaluations of the firm's liquidity, activity, debt, profitability, and market.
c. Summarize the firm's overall financial position on the basis of your findings in part b.


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To: Management
Martin Manufacturing

From: [Name]
Martin Manufacturing

Subject: Evaluation of the Martin Manufacturing's financial position

All the following underlying financial analysis show that Martin Manufacturing's financial position has been deteriorating though in some areas, several financial metrics showed improvement. Unfortunately, this current financial position, as shown in Table 1, shows that the firm lags the industry.

The company is more liquid than it was in 2005 and 2005 and it is much better off in this metrics than the average company in the industry. This is not surprising as current liabilities declined significantly in the period which compensated for the slight decline in current assets from 2005 to 2006. However, the company's very high current ratio as compared to the industry may also ...

Solution Summary

The expert assesses Martin Manufacturing's Current Financial Positions.