Question

By using the market averages please calculate below ratios and more importantly make relevant comments (analysis) for Good Foods, Inc. for the year 2019 by comparing the market average.

• Vertical analysis
• Working capital
• Current ratio
• Quick ratio
• Accounts receivable turnover
• Number of days’ sales in receivables
• Inventory turnover
• Number of day’s sales in inventory
• The ratio of fixed assets to long term liabilities
• The ratio of liabilities to stockholders’ equity

Good Foods, Inc. Income Statement 2019 (in ‘000 USD)
Description	Value
Gross Sales	9.800
Discounts	-1.400
Net Sales	8.400
COGS	-7.900
Gross Profit	500
Operational Expenses	-850
Selling & Marketing Expenses	-390
G&A Expenses	-275
R&D Expenses	-185
Operational Income/Loss	-350

Good Foods, Inc. Balance Sheet 2019 & 2018 (in ‘000 USD)
Description	2019	2018
Current Assets	1.220	1.270
Cash	20	60
Banks	30	90
Accounts Receivable	480	340
Inventory	690	780
Property, Plant & Equipment	1.430	1.185
Land	150	150
Buildings	290	290
Machinery	1.100	840
Accum.Depreciation	-110	-95
TOTAL ASSETS	2.650	2.455
Current Liabilities	2.020	1.070
Accounts Payable	1.980	1.050
Taxes Payable	40	20
Lon-Term Liabilities	400	865
Bank Credits	400	865
TOTAL LIABILITIES	2.420	1.935
Stockholders’ Equity	230	520
Common Stock	580	400
Retained Earnings	-350	120
TOTAL LIAB. & STOCKHOLDERS’ EQUITY	2.650	2.455

Answer 1