Question

The​ table, shows key financial data for three firms that compete in the consumer products​ market: Procter​ & Gamble,​ Colgate-Palmolive, and Clorox.

Procter & Gamble   Colgate-Palmolive   Clorox
Sales   65,233   15,210   5,872

Cost of goods sold   32,967   6,081   3,229
Accounts receivable   4,732   1,403   513
Inventory   4,790   1,166   497
Total current assets   25,575   4,343   1,540
Total current liabilities   28,910   3,303   2,031
Total assets   117,026   12,116   4,573

a. Calculate each of the following ratios for all three​ companies: current​ ratio, quick​ ratio, inventory​ turnover, average collection​ period, total asset turnover.

b. What company is in the position of having greatest​ liquidity?

c. Would you say that the three companies exhibit similar performance or quite different performance in terms of collecting​ receivables? Why do you think that might​ be?

d. Which company has the most rapid inventory​ turnover? Which company appears to be least efficient in terms of total asset​ turnover? Are your answers to those questions a little​ surprising? If a company is best at inventory turnover and worst at total asset​ turnover, what do you think that​ means?

Answer 1

lpirociesīERejeilliliitol63 65233 32967 4732 4790 25575 28910 117026 @城事atite?伊 allliini olliwe @dkt湄 DATA GIVEN sales cost of goods sold accounts receivable inventory total current assets total current liabil;ities total assets ANSWERS ratio &formula current ratio current assets/current liabilities quick ratio- current assets- inventory/current liabilities inventory turnover- cost of goods sold/average inventory(times) average collection period (days) 26.477089823 accounts receivables turnover ratio (times) assets turnover ratio-sales/total assets (times) note: answers are not rounded because round off factor not mentioned in the problem so I provided full answers without round off,please use comment box for further clarification x 15210 6081 1403 1166 4343 3303 5872 3229 513 497 1540 2031 4573 procter&gamble colgate-palmolive clorox 1.314865274 0.7582472 0.961852861 0.5135401 5.215265866 6.4969819 0.884641992 0.718955379 6.882463466 33.66831032 31.887772 10.84105488 11.446394 1.255364807 1.2840586 13.78550296 0.557423137

b) answer: Colgate- Palmolive.

c) quite different performance in terms of collection period. because porter and gamble company collection period is less than the other two companies and Colgate Palmolive and Clorox have similar collection period .

d) proctor and gamble has the most rapid inventory turnover

proctor ang gamble appears to be least asset turnover

the particular company more depends upon the inventory and here assets are generating lower sales revenue .