Lending: Case 2 Boat Builders

Lending Financial Analysis of Boat Builders Boat Builders Case 2 several(prenominal) changes that must be made to the financial statements in eccentric person 1 of Boat Builders. The Debtors figure in the Balance should be increase by $280,000 that DSFE owe the play along. As a dissolving agent of this the current years total current additions should be $387717 instead of $107717, and total assets should be $637178 instead of $357178. Also the bear on pay adequate to(p) on the loan is under stated and study to be adjusted. The Interest should be $6,004.8 which is ten percent of the $6, 0048 wintry confines loan 2 instead of $838. Also there are not provisions made for taxation on the unions overdraft. 1. Ratios Analysis of Boat Builders Short term facileity Current Ratio= Current Asset/Current Liabilities remainder stratum= 134085/102031 = 1.314 Current grade = 387717/219781 = 1.76 delay year the smart set had a current ratio of 1.314 which is average. This means that the company was liquid enough to meet its short term obligations, but just. And thusly in the current year the ratio grow to 1.796 as the company becomes more liquid. Quick Ratio = quick asset/current liabilities Last Year = 134085-3000/102031-66875 = 2.728 Current Year = 387717-30000/219781-4000 = 1.66 Last year the company had a quick ratio of 2.

728 which shows that the company had enough liquidity to meet its obligations. In the current the company becomes a little less liquid but sedate able to meet its short term obligations if they fall due. Debtors turnover = trade debtors/avg daily sales Last Year = 35530/(418829/365) = 21 Current Year = 315168/(1692538/365)= 68 Boat builders collected at a rate of 21 times from their debtors last year. In the current year they were able to collect 68 times on average as the company becomes more efficient in collecting from its debtors old-hat Turnover = Avg stock/daily cost of sales Last Year = 30000/715.32 = 41.94 Current Year = 30000/3903.61 = 7.68 Last Year the company turnover its... If you want to get a full essay, order it on our website: Ordercustompaper.com

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