Ratio Analysis Case
...Acid-test ratio = quick assets / current liabilities
Quick assets = (1,120,000 – 610,000) = 510,000
Therefore, acid-test ratio = 510,000 / 600,000 = 0.85
Average collection period = 365/ receivables turnover
Receivable... Ratio Analysis Case Section One Return on Total Asset (ROTA) can be calculated as; ROTA = Earnings before interest and tax/total net assets (Siddiqui, 623)
Net Assets = total assets – liabilities
Net assets = 3,000, 000 + 2,400, 000 – 1,600, 000 = 3,800, 000
Earnings before interest and tax = 340, 000
ROTA = 340, 000/ 3,800,000 = 0.0895
Return on common stockholders’ equity = Net income divided by average common stockholders’ equity.
Net income = 182, 000
Average common stockholders’ eq...