Ratio 2014 2015 2016 Industry Interpretations Recommendations

Average
LIQUIDITY
Current ratio 1,831,999.85 2,026,920.33 2,115,771.85
96,978.20 63,012.25 92,420.94
=18.89 = 32.17 = 22.89
Working Ratio 1,831,999.85 - 96,978.20 2,026,920.33 - 63,012.25 2,115,771.85 - 92,420.94
= 1,735,021.64 =1,963,908.08 = 2,023,351.91
Quick Ratio 1,831,999.85 - 0 2,026,920.33 - 0 2,115,771.85 – 0
96,978.20 63,012.25 92,420.94
=18.89 = 32.17 = 22.89
Monetary Ratio (1,831,999.85 – 0 ) - (2,026,920.33 – 0) - (2,115,771.85 – 0) -
96,978.20 63,012.25 92,420.94
= 1,735,021.64 =1,963,908.08 = 2,023,351.91
EFFICIENCY
Receivable 1,356,648.78 1,525,521.39____ 1,332,811.69____ 10.16 For the receivable For the year 2014 and
Turnover 114,100.45 (170,343.55+114,100.45) (248,656.65+170,343.55) turnover ratio, both the 2015, data have shown that
= 11.89 2 2 years 2014 and 2015 the company has been
= 10.73 = 6.36 exhibited ratios that efficient in executing its
are higher than the collection policies.
industry average of However, data shows a
10.16. These ratios negative trend from the
indicates that the base year of 2014.
company has been From these facts, the group
efficient in concludes that the
implementing their company shall be stricter
collection policies. regarding the
The 2014 and 2015 implementation of its
receivable turnover collection policies, for
ratio also provides that them to collect faster. The
it takes the company company might also
shorter time to collect consider offering trade
on their credit sales discounts to encourage
compared to the faster credit collection
industry average. from the customers.

On the other side, the

latest year turnover
shows that the
company has not been
efficient in
implementing its
credit policies, thus
collecting credits at a

Page 1 of 4
 rate slower than the
industry average.

The rates from the first

year to the third year
comparison exhibits a
negative trend, which
is an evidence that the
company is
decreasingly efficient
in providing credits to
their customers.
Payable Turnover 501,110 667,809.73 580,994.47______ 12.17 Contrary to receivable LG laundry shop should
36,411.52 (26789.56+36,411.52) (41,791.71+26789.56) turnover ratio, payable consider maximizing its
= 13.76 2 2 turnover ratio credit period without
=21.13 = 16.94 indicates the damaging its credit rating.
company’s efficiency And to maximize the credit
in paying its suppliers. period, the company must
Compared to the slow down the payments
industry average of 12. while taking advantage of
17, the data of the it by using the money in
company shows that it paying other credits that
has been efficient in are approaching its
meeting its currently maturity. In this case,
maturing obligations while taking advantage of
with its suppliers or the discounts that the
outside creditors. creditor provides, the
However, in the year company is also being
2015, the rate almost efficient in paying not only
doubled the industry its trade payables regarding
average. This implies its purchases, but also in
that instead of taking paying its accruals and
advantage of the credit other liabilities.
period, the company
pays their credit at a
rate twice faster than
what the industry has
set.

Investing None None None None None None

Inventory
Turnover

Page 2 of 4
 Average 360 360 360
Collection 11.89 8.96 6.36
= 30.27 =40.18 = 56.59
Period
Average
Conversion None None None None None None
Period
Average Payment 360 360 360 29 Days Since all the resulting The resulting data confirms
Period 13.76 15.46 16.94 periods are lower than that the company has not
= 26.16 =23.29 = 21.25 the industry average, been maximizing the
these suggest that the utilization of its credit
company is paying off terms. Though this attracts
their creditors at the prospective suppliers and
rates faster than the 29 lenders, the company shall
days credit terms of also take in mind that there
the industry. These will still be no added
rates can provide benefit in paying earlier
positive insight to than the date expected.
prospective lenders Thus, it shall maximize the
and suppliers period in which it can use
regarding the credit the money for other
worthiness of the purposes or invest it where
company. it can earn before the credit
falls due.
Normal Operating 30.27 + 0 40.18 + 0 56.59 + 0
Cycle = 30.27 = 40.18 =56.59
Cash Conversion 30.27 + 0 – 26.16 40.18 + 0 – 23.29 56.59 + 0 – 21.25
Cycle = 4.12 =16.89 = 35.34

PROFITABILITY
Return on Assets 165,331.33 127,757.34 121,135
2,742,161.75 2,835,953.13 2,986,496.83
= 6.03% =4.50% = 4.06%
Return on Sales 165,331.33 127,757.34 121,135
1,356,648.78 1,525,521.39 1,332,811.69
= 12.29% = 8. 37% = 9.09%
Return on Equity 165,331.33 127,757.34 121,135
2,645,183.54 2,772,940.89 2,894,075.89
= 6.25% = 4.61% = 4.19%
Earnings Per 165,331.33 127,757.34 121,135
Share 250,000 shares 250,000 shares 250,000 shares
= 0.58 = 0.51 = 0.48
Book Value Per 2,645,183.54 2,772,940.89 2,894,075.89
Share 250,000 shares 250,000 shares 250,000 shares
= 10.58 = 11.09 = 11.58

Page 3 of 4
 MARKET TEST
Price/Earnings
Ratio
Dividend Yield
Ratio
Dividend Payout
Ratio
Flowback Ratio
SOLVENCY
Debt Ratio 96,978.20 63,012.25_ 92,420.94_
2,742,161.75 2,835,953.13 2,986,496.83
= 3.54% = 2.22% = 3.09%
Equity Ratio 2,645,183.54 2,772,940.89 2,894,075.89
2,742,161.75 2,835,953.13 2,986,496.83
= 96.46% = 97.78% = 96.91%
Debt-Equity Ratio 96,978.20 63,012.25_ 92,420.94_
2,645,183.54 2,772,940.89 2,894,075.89
= 3.67% = 2.27% = 3.19%
Times Interest 224,637.48 177,653.35 173,050
Earned Ratio 2,040.76 3,400.00 0
= 11. 08 = 52.25 = None

Page 4 of 4