Mark X Company a Executive Summary
[Type the company name] | Mark X Company (A) | Financial Analysis and Forecasting | | labtech | [Pick the date] |
Analysis Analyzing Mark X Company’s financial statements and projecting the expected numbers for the coming years we make a decision on whether or not Mark X Company qualifies for the loan extension of $6,375,000.
The strength of Mark X as a company is its fixed assets turnover ratio, which rose from 1990 to 1992. This tells us Mark X 's ability to generate net sales from each addition of a fixed asset. Sales generated from the fixed assets are greater than the costs of the fixed assets, which imply that the fixed assets that were purchased are good investments for the company. This is really the only positive ratio they have at the moment. Weaknesses we found in Mark X were its debt ratio, which increased from 40.47% in 1990 to 46.33% in 1991 and from 46.33% to 59.80% in 1992. This shows us Mark X 's amount of debt relative to its assets is increasing and that its debt is equal to more than half of its assets by 1992. The current ratio and quick ratio has also indicated negative change, both decreasing between 1990 and 1992. The current ratio is a liquidity ratio that measures a company 's ability to pay short term obligations, while the quick ratio shows a company 's ability to pay its short-term obligations with its most liquid assets. Both ratios are steadily decreasing, indicating to us the position of the company has become less and less favorable. The company’s asset management ratios also show decreasing numbers. The inventory turnover ratios have decreased as well as the total asset turnover. This explains the number of times a company 's inventory is sold and replaced during a period. The company 's days sales outstanding (ACP) also rose from 36.00 in 1990 to 53.99 in 1992. This shows us that Mark X 's average number of days to collect revenues after a sale has increased. This number is unfavorable because this
Analysis Analyzing Mark X Company’s financial statements and projecting the expected numbers for the coming years we make a decision on whether or not Mark X Company qualifies for the loan extension of $6,375,000.
The strength of Mark X as a company is its fixed assets turnover ratio, which rose from 1990 to 1992. This tells us Mark X 's ability to generate net sales from each addition of a fixed asset. Sales generated from the fixed assets are greater than the costs of the fixed assets, which imply that the fixed assets that were purchased are good investments for the company. This is really the only positive ratio they have at the moment. Weaknesses we found in Mark X were its debt ratio, which increased from 40.47% in 1990 to 46.33% in 1991 and from 46.33% to 59.80% in 1992. This shows us Mark X 's amount of debt relative to its assets is increasing and that its debt is equal to more than half of its assets by 1992. The current ratio and quick ratio has also indicated negative change, both decreasing between 1990 and 1992. The current ratio is a liquidity ratio that measures a company 's ability to pay short term obligations, while the quick ratio shows a company 's ability to pay its short-term obligations with its most liquid assets. Both ratios are steadily decreasing, indicating to us the position of the company has become less and less favorable. The company’s asset management ratios also show decreasing numbers. The inventory turnover ratios have decreased as well as the total asset turnover. This explains the number of times a company 's inventory is sold and replaced during a period. The company 's days sales outstanding (ACP) also rose from 36.00 in 1990 to 53.99 in 1992. This shows us that Mark X 's average number of days to collect revenues after a sale has increased. This number is unfavorable because this