The Jimenez Corporation’s forecasted 2016 financial statements follow, along with some industry average ratios. Calculate Jimenez’s 2016 forecasted ratios, compare them with the industry average data, and comment briefly on Jimenez’s projected strengths and weaknesses.
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Per Share Data
EPS ………………………………………………. $ 4.71
Cash dividends per share …………………………. $ 0.95
P/E ratio ………………………………………….. 5.0
Market price (average) …………………………… $ 23.57
Number of shares outstanding …………………… 23,000
Industry Financial Ratios (2015)a
Quick ratio ………………………………………. 1.0
Current ratio …………………………………….. 2.7
Inventory turnoverb ……………………………… 7.0
Days sales outstandingc …………………………. 32.0 days
Fixed assets turnoverb ……………………………. 13.0
Total assets turnoverb ……………………………. 2.6
Return on assets ………………………………….. 9.1%
Return on equity …………………………………. 18.2%
Profit margin on sales …………………………….. 3.5%
Debt-to-assets ratio ……………………………….. 21.0%
Liabilities-to-assets ratio ………………………….. 50.0%
P/E ratio …………………………………………… 6.0
Price/Cash flow ratio ……………………………… 3.5
Market/Book ratio …………………………………. 3.5
aIndustry average ratios have been stable for the past 4 years.
bBased on year-end balance sheet figures.
cCalculation is based on a 365-day year.
The Jimenez Corporation s forecasted 2016 financial statements follow along with