Financial Case Analysis - Ratio Analysis

The financial proportions used in this problem show that Bethesda mine has some work ahead of them. There is substantial expression of life for improvement for some of the symmetrys involved. A more staring(a) synopsis would require balance information from the mining effort as a whole but a footling centering is provided below. The authentic ratio is low. Bethesda Minings current ratios over the devil old age given indicate negative clams working capital. short bullion to cover daily expenses is non an attractive site in any industry. One gene in particular proposition that is decreasing the current ratio is accounts payable. This item is rather senior tall and is affecting the companys short-run liquidity. On a bright note, the current ratio meliorate 22.3% year-to-year so focus appears to be in the correct place. Removing roll levels from the equation yields the quick ratio, which is significantly slight than the current ratio for Bethesda Mining. This dec rease indicates that part of the problem may be even into excessive inventory levels. This, coupled with the lofty accounts payable values, is prejudicial the current ratio. The quick ratio draws economic aid to this as its value is less than half that of the current ratio. The property ratio is a very straightforward calculation. In Bethesda Minings case, it is clearly locution there is not enough bullion sexual sexual relation to current liabilities.

Taking the three ratios discussed so far into account, it could be theorized that Bethesda Mining is purchasing inventory at a high level than sales are occurring. Th e accounts payable accounts (though decreasi! ng in 2003) are still too high when compared to the available cash on hand. The debt-equity, equity multiplier, and total debt ratios all lead to synonymic conclusions. Bethesda Mining is utilizing a nearly 50/50 debt-equity go on to fund assets. 2003 figures show that the firm is... If you want to perk up a full essay, order it on our website: OrderCustomPaper.com

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