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Financial Analysis for Drd

By:   •  July 5, 2019  •  Coursework  •  509 Words (3 Pages)  •  318 Views

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4-1 Discussion: Analysis of Financial Statement

Dafina Lamlli posted Jun 20, 2019 9:07 PMLast edited: Friday, June 21, 2019 12:04 PM EDTSubscribed

Hello class!

2015

% Chg

2014

Current Assets

60,000

120.6%

27,188

Total Assets

83,500

65.3%

50,492

Current Liabilities

41,262

-41.7%

70,854

Total Debt

200

-2.4%

205

Sales/Revenue

53,000

266%

14,480

Cost of Goods Sold

(29,500)

-447.9%

8,478

Inventory

40,000

144.7%

16,341

Net Income/Loss

62,600

272.1%

16,822

Year 2015

Current Ratio

1.45

Debt to Asset Ratio

0.002

Inventory Turnover

-1.04

Return on Sales (Profit Margin)

1.18

Current Ratio

Deep Roots Distillery’s current ratio is 1.45. This financial ratio is calculated by dividing current assets ($60,000) by current liabilities ($41,242). A high current ratio indicates that the firm can pay its liabilities. DRD’s current ratio is below the average, which is 2.0. The company can improve its current ratio by repaying current liabilities, by reducing dividend payments to stockholders to increase cash balance of the firm, or obtaining cash from inventors (Pride, Hughes & Kapoor, 2017).

Inventory Turnover

The average inventory can be found by adding

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