In: Accounting
The following financial data are adapted from the annual reports of Bechuram Inc.:
Bechuram Inc.
Four -Year Select Financial Data
Years Ended January 31, 2017, 2016, 2015,2014
Operating Results
2017
2016
2015
2014
Net Sales
$13,848
$13,673
$11,635
$9,054
COGS (excluding depreciation and amortization)
9704
8599
6775
5318
Interest Expense
109
75
45
46
Income from Operations
338
1445
1817
1333
Net Earnings
-8
877
1127
824
Cash Dividends
76
75
76
77
Financial Position:
Merchandise Inventory
1677
1904
1462
1056
Total Assets
7591
7012
5189
3963
Current Ratio
1.48:1
0.95:1
1.25:1
1.20:1
Shareholders' Equity
3010
2928
2630
1574
Average number of shares of common stock outstanding (in thousands)
860
879
895
576
Compute the following ratios for 2015 through 2017 and evaluate Bechuram’s operating results. Are operating results strong or weak? Did they improve or deteriorate during the three-year period? Your analysis will reveal a clear trend.
a. Inventory turnover (assume occupancy expenses are included in cost of goods sold)
b. Gross profit percentage
c. Operating income (profit) percentage
d. Return on sales
e. Asset turnover
f. Return on assets
g. Leverage ratio
h. Return on shareholders’ equity
i. Times-interest-earned ratio
j. Earnings per share