Compare the financial condition of “Titan” in
the Marketplace simulation at the end of Q4 and the...

Question

Compare the financial condition of “Titan” in
the Marketplace simulation at the end of Q4 and the end of Q8. Analyze the data
and draw your conclusions, comparing the financial conditions at the end of Yr2,
Q8 to the Yr1, Q4. Finally, provide your
recommendations for improving the firm's financial condition in a third year of
operation.

Robert · Accepted Answer

Financial Position of Titan 
Year 1, Quarter 4: 
The liquidity position of Titan is as per industry norms. The current liquidity ratio and 
quick liquidity test ratio are 0.1 and 0.0 respectively. But they are much below the standard norm 
of 2 and 1 respectively. In terms of activity ratios or asset utilization ratios, fixed asset turnover 
and total asset turnover ratio are 1.5 each. The total asset turnover is better than average in 
market, it implies that Titan is able to effectively use its total assets. The fixed asset turnover and 
inventory turnover is lower than industry average. The proportion of debt in company’s capital 
structure is greater than industry average. It is equivalent to industries highest. The debt ratio is 
23.3% and debt to paid in capital is 30.4%.

Compare the financial condition of “Titan” in the Marketplace simulation at the end of Q4 and the end of Q8. Analyze the data and draw your conclusions, comparing the financial conditions at the end...

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