Question (substitute for some part of Question 7,8, and 9) Evaluate the financial performance of the two companies and then determine which is the best as required below? Company X Company Y Item 1 2 3 4 5 1 2 3 4 5 Current ratio 1.11 1.14 1.20 1.26 2.05 4.20 5.49 4.02 4.85 8.97 Quick ratio 0.41 0.42 0.43 0.44 0.76 0.35 0.17 0.15 0.20 4.78 Net cash from operating(Million) 121 97 92 125 165 29 16 28 53 3 Net cash from Investing (Million) -10 -15 -6 -6 -33 28 -2 -23 -1 -1 Net cash from Financing (Million) -111 -79 -81 -115 -115 -56 -17 -4 -51 244 Net cash (Million) 0 3 5 4 17 0 -4 1 1 246 Gross profit margin 0.24 0.25 0.22 0.20 0.19 0.36 0.35 0.37 0.35 0.42 Net profit margin 0.17 0.18 0.16 0.15 0.15 0.12 0.03 0.12 0.11 0.12 Return of Assets 0.15 0.17 0.19 0.19 0.24 0.03 0.01 0.03 0.04 0.02 Return of Equity 0.27 0.31 0.34 0.36 0.35 0.04 0.01 0.04 0.05 0.02 EPS 16.68 19.73 22.67 20.10 29.37 3.43 0.74 3.24 3.41 1.80 Receivables Turnover 5.71 6.16 7.25 8.38 10.62 9.38 11.48 17.13 23.10 19.32 Inventories Turnover 2.10 2.40 2.70 3.00 3.80 0.30 0.30 0.30 0.40 0.30 Assets Turnover 0.90 1.00 1.20 1.40 1.80 0.20 0.20 0.20 0.30 0.20 Cost of sales/ sales 0.76 0.75 0.78 0.80 0.81 0.64 0.65 0.63 0.65 0.58 Liabilities/ Assets 0.45 0.45 0.46 0.47 0.32 0.33 0.28 0.29 0.23 0.09 In general, which company is better in liquidity and why? In general, which company is better in efficiency and why? In general, which company is better in profitability and why? In general, which company is more risky and why? Select at least three problems that each company has faced? In general and based in your answers, which company is better financial performance and why? Company X Company Y Item 1 2 3 4 5 1 2 3 4 5 Current ratio 1.11 1.14 1.20 1.26 2.05 4.20 5.49 4.02 4.85 8.97 Quick ratio 0.41 0.42 0.43 0.44 0.76 0.35 0.17 0.15 0.20 4.78 Net cash from operating(Million) 121 97 92 125 165 29 16 28 53 3 Net cash from Investing (Million) -10 -15 -6 -6 -33 28 -2 -23 -1 -1 Net cash from Financing (Million) -111 -79 -81 -115 -115 -56 -17 -4 -51 244 Net cash (Million) 0 3 5 4 17 0 -4 1 1 246 Gross profit margin 0.24 0.25 0.22 0.20 0.19 0.36 0.35 0.37 0.35 0.42 Net profit margin 0.17 0.18 0.16 0.15 0.15 0.12 0.03 0.12 0.11 0.12 Return of Assets 0.15 0.17 0.19 0.19 0.24 0.03 0.01 0.03 0.04 0.02 Return of Equity 0.27 0.31 0.34 0.36 0.35 0.04 0.01 0.04 0.05 0.02 EPS 16.68 19.73 22.67 20.10 29.37 3.43 0.74 3.24 3.41 1.80 Receivables Turnover 5.71 6.16 7.25 8.38 10.62 9.38 11.48 17.13 23.10 19.32 Inventories Turnover 2.10 2.40 2.70 3.00 3.80 0.30 0.30 0.30 0.40 0.30 Assets Turnover 0.90 1.00 1.20 1.40 1.80 0.20 0.20 0.20 0.30 0.20 Cost of sales/ sales 0.76 0.75 0.78 0.80 0.81 0.64 0.65 0.63 0.65 0.58 Liabilities/ Assets 0.45 0.45 0.46 0.47 0.32 0.33 0.28 0.29 0.23 0.09 Solution Answer (1)- Better in Liquidity- Company \"X\" is more liquid as if we see its Quick ratio through out the four periods, these are higher than the company Y\'s quick ratio. Quick ration indicates liquidity position of t.