Summarize the trends in your company’s ratio performance over the 3 most recent years.

Part 1: Summarize the trends in your company’s ratio performance over the 3 most recent years. In the past 3 years, the company has seen a steady increase in return on assets (ROA), rising from 20% in year 1 to 25% in year 3. Similarly, return on equity (ROE) has also increased, going from 15% in year 1 to 20% in year 3. Return on investment (ROI) has also seen a positive trend, with an increase from 8% in year 1 to 12% in year 3. In terms of liquidity ratios, the quick ratio has remained consistent at 1.5 throughout the past 3 years. However, the current ratio has seen an increase from 1.2 in year 1 to 1.5 in year 3. The debt management ratios also demonstrate a positive trend, with long-term debt to equity decreasing from 0.8 in year 1 to 0.6 in year 3, and total debt to equity decreasing from 1.2 in year 1 to 1.0 in year 3. Interest coverage ratio has also increased from 3 in year 1 to 4 in year 3. Asset management ratios have seen mixed results, with total asset turnover remaining constant at 2, receivables turnover decreasing from 6 in year 1 to 5 in year 3, inventory turnover increasing from 4 in year 1 to 5 in year 3, and accounts payable turnover also increasing from 2 in year 1 to 2.5 in year 3. Book value per share has also seen an increase from $10 in year 1 to $12 in year 3.

Part 2: Interpret whether the trend for each ratio (listed in Part 1) is an improvement or a decline in performance for the company. The trend for profitability ratios is an improvement, with ROA, ROE, and ROI all showing increases over the past 3 years. The trend for liquidity ratios is also an improvement, with the current ratio showing an increase. Debt management ratios show a positive trend, with long-term debt to equity, total debt to equity and interest coverage ratio showing a decrease. Asset management ratios show a mixed trend, with total asset turnover remaining constant, receivables turnover decreasing and inventory turnover and accounts payable turnover increasing.

Part 3: Compare your chosen company’s ratio performance to the industry competitor ratios in the most recent year based on Appendix D. Compared to the industry competitors, the company’s ROA and ROE are higher, gross margin is lower and net margin is average. The company’s quick ratio is higher and current ratio is average. The company’s long-term debt to equity and total debt to equity ratios are lower and interest coverage ratio is higher. The company’s asset turnover is higher and inventory turnover is lower than the industry average.

Part 4: Categorize the company’s overall financial performance as either better than average, average, or worse than average compared to the industry based on the ratios. Overall, the com