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    My Life at 6ft Below

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    vasquez.jabezraphael308129

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    My Life at 6ft Below

    Uploaded by

    vasquez.jabezraphael308129
    17 views1 page

    Original Title

    My Life @ 6ft Below

    Copyright

    © © All Rights Reserved

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    DOCX, PDF, TXT or read online from Scribd

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    Copyright:

    © All Rights Reserved
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    Download as docx, pdf, or txt
    17 views1 page

    My Life at 6ft Below

    Uploaded by

    vasquez.jabezraphael308129

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    I.

    Line Item 2021 2022 Annual Percentage


    Growth 2021-2022
    Sales 475,000 500,000 1.) 5.26%
    Cost of Goods Sold 265,000 269,000 2.) 1.51%
    Gross Profit 210,000 231,000 3.) 9.90%

    Wages 154,000 163,000 4.) 5.84%


    Repairs 5,800 4,150 5.) 28.45%
    Rent 13,000 12,000 6.) 7.69%
    Taxes 16,940 17,930 7.) 5.84%
    Office Expenses 1,023 587 8.) 42.42%
    Total Expenses 190,763 197,667 9.) 3.62%
    Net Income 19,237 33,333 10.) 73.28%

    II. Interpretation w/ explanation

    1. Current (Good): The company's current ratio of 5.7 is significantly higher than the industry
    average of 4. This indicates that the company has a strong ability to pay off its short-term debts
    with its current assets.
    2. Days Sales Outstanding (Not Good): The company's Days Sales Outstanding (DSO) of 37 days is
    lower than the industry average of 42 days. This seems positive at first glance, but a lower DSO
    could also indicate that the company is offering overly generous credit terms to its customers,
    which could lead to bad debt expense in the future.
    3. Total Debt to Total Capital (Not Good): The company's Total Debt to Total Capital ratio of
    47.80% is significantly higher than the industry average of 32.60%. This indicates that the
    company is relying more on debt financing than equity financing, which can be risky in the event
    of an economic downturn.
    4. Times-Interest Earned (Not Good): The company's Times-Interest Earned ratio of 2.2 is much
    lower than the industry average of 6. This ratio indicates the company's ability to cover its
    interest expense. A ratio lower than 1.0 means the company is not generating enough income to
    cover its interest expenses. While the company here is above 1.0, a 2.2 ratio is still considered
    low and suggests that the company may struggle to meet its interest obligations in the future.
    5. Profit Margin (OK): The company's profit margin of 6.10% is slightly higher than the industry
    average of 6.00%. This indicates that the company is able to generate a small profit on every
    dollar of revenue.
    6. Return on Invested Capital (ROIC) (OK): The company's ROIC of 10.03% is almost identical to the
    industry average of 10.00%. This ratio measures how effectively a company is using its invested
    capital to generate profits. An ROIC that is equal to the cost of capital indicates that the
    company is just breaking even on its investments.
    7. Enterprise Value to EBITDA (Undervalued): The company's Enterprise Value to EBITDA ratio of
    0.87 is lower than the industry average of 1.12. This ratio suggests that the company may be
    undervalued by the market. However, it's important to consider other factors such as the
    company's growth prospects and risk profile before making any investment decisions.

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