Reference no: EM131935607

Question: You have been asked to perform financial condition ratio analyses for two communities, Thriftyville and Myopica, based on data culled from each of their CAFRs. Both towns have a similar median family income of $50,000. Total long-term debt outstanding per capita is $1,500 for Thriftyville and $5,000 for Myopica. Thriftyville has operating revenues of $105,000,000 and Myopica has operating revenues of $90,000,000. Revenue from own sources for Thriftyville is $60,000,000 while it is 85,000,000 for Myopica. You can attribute the difference between total operating revenues and own source revenues as the intergovernmental revenue component for each community. Thriftyville has planned operating expenditures of $102,000,000 while Myopica has $100,000,000 in planned operating expenditures. Cash and short-term investments on hand for each community is $15,000,000. Current liabilities for Thriftyville are 8,000,000 while it is $14,000,000 for Myopica. For each community, please calculate a financial ratio (if necessary) for assessing

1) fiscal effort,

2) operating deficits,

3) stability of revenues,

4) ability to meet short-term commitments, and

5) ability to meet long-term commitments. Based on these calculations, explain who is doing financially better on each measure.