2017 2018 Liquidity : C/R 1.17 : 1 1.05 : 1 Acid test 0.87 : 1 0.78...

Question

    2017
    2018
    Liquidity :


    C/R
    1.17 : 1
    1.05 : 1
    Acid test
    0.87 : 1
    0.78 : 1
    Profitability:


    Operating Margin
    38.7%
    63.8%
    GP
    23%
    23%
    ROCE
    4.46%
    9.05%
    Sovency Ratio:


    D/A
    0.63
    0.64
    D/E
    1.75
    1.77
    Activity:


    Return on asset
    0.88
    1.08
    Inventory Turnove
    1.0
    1.27
    Debtors days
    9.8 days
    12.4 days
    Valuation:


    Earnings per share
    1.03
    2.8


    2017
    2018
    Liquidity :


    C/R
    1.17 : 1
    1.05 : 1
    Acid test
    0.87 : 1
    0.78 : 1
    Profitability:


    Operating Margin
    38.7%
    63.8%
    GP
    23%
    23%
    ROCE
    4.46%
    9.05%
    Sovency Ratio:


    D/A
    0.63
    0.64
    D/E
    1.75
    1.77
    Activity:


    Return on asset
    0.88
    1.08
    Inventory Turnove
    1.0
    1.27
    Debtors days
    9.8 days
    12.4 days
    Valuation:


    Earnings per share
    1.03
    2.8

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Khushboo · Accepted Answer

Financial ratio analysis:
The company’s current ratio and quick ratio has decreased in year 2018 as compared to year 2017 which depicts that the liquidity situation of the entity has tightened in year 2018 which is a negative indication for the organization. The operating margin of the entity has increased by 25.

2017 2018 Liquidity : C/R 1.17 : 1 1.05 : 1 Acid test 0.87 : 1 0.78 : 1 Profitability: Operating Margin 38.7% 63.8% GP 23% 23% ROCE 4.46% 9.05% Sovency Ratio: D/A 0.63 0.64 D/E 1.75 1.77 Activity:...

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