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Management
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Topic:
Please refer to the East Coast Yachts Case at the end of chapter 3
Essay Instructions:
Please refer to the East Coast Yachts Case at the end of chapter 3.
1) Please calculate the ratios for East Coast Yachts for the industry ratios listed.
2) Compare East Coast liquidity, financial leverage and turnover ratios to the industry standards. Please analyze if East Coast is doing better or worse than the industry standard and what that means for the company.
*Must demonstrate good knowledge of the discussion concepts. Use your learning this week to apply your analytical skills in order to further your learning. You must not rely entirely on the references, and must comply with APA standard rules by providing in-text citations (including double quotations) and references taken from any sources.
Essay Sample Content Preview:
East Coast Yachts Case – Chapter 3
Student’s Name
Institution
Course Number and Name
Instructor’s Name
Date
East Coast Yachts Case – Chapter 3
Question 1: ECY’s Ratios
Ratio
Formula
Calculation
Ratios
Current ratio
Current assets/Current liabilities
41,499,700/41,297,975
1.005
Quick ratio
(Current assets-inventory)/current liabilities
(41,499,700-16,322,100)/ 41,297,975
0.61
Total asset turnover
Sales/Total Assets
495,381,600/326,216,600
1.52
Inventory turnover
COGS/Inventory
357,466,500/16,322,100
21.9
Receivables turnover
Sales/Account receivable
495,381,600/15,131,900
32.74
Debt ratio
(Total assets-Total equity)/Total assets
(326,216,600-147,718,624)/ 326,216,600
0.55
Debt equity ratio
Total debt/Total equity
$0.55/$0.45
1.22
Equity multiplier
Total assets/Total equity
1$/$0.45
2.22
Interest coverage
EBIT/Interest
62,548,100/8,910,000
7.02
Profit margin
Net income/Sales
40,228,575/495,381,600
0.0812 or 8.12%
Return on assets
Net income/Total assets
40,228,575/326,216,600
0.1233 or 12.33%
Return on equity
Net income/Total equity
40,228,575/147,718,624
0.2723 or 27.23%
Question 2. Comparison with Industry standards
Liquidity ratios
Ratio
ECY
In...
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