Task - Please see attachments. Must show work please
A. Perform a Du Pont analysis on BestCare. Assume that the industry average ratios are as follows:
|
Total margin
|
3.8%
|
|
Total asset turnover
|
2.1
|
|
Equity multiplier
|
3.2
|
|
Return on equity (ROE)
|
25.5%
|
B. Calculate the interpret the following ratios for BestCare:
|
|
Industry Average
|
|
Return on assets (ROA)
|
8.0%
|
|
Current ratio
|
1.3
|
|
Days cash on hand
|
41 days
|
|
Average collection period
|
7 days
|
|
Debt ratio
|
69%
|
|
Debt-to-equity ratio
|
2.2
|
|
Times interest earned (TIE) ratio
|
2.8
|
|
Fixed asset turnover ratio
|
5.2
|
Attachment:- Assignment File.rar