How does this impact your internal finance sources

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Reference no: EM133378610

Question: After providing the credit department with your analyses. The chief officer provides you with the industry averages and medians. How does this impact your internal finance sources? Justify using the mean or median in your calculations. Do not calculate both the mean or median, justify why you are using either the mean or median. Show all relevant calculations.

INDUSTRY	MEAN	MEDIAN
LIQUIDITY RATIOS
CURRENT RATIO	2.00	2.00
QUICK RATIO	1.25	1.25
ACTIVITY RATIOS
INVENTORY TURNOVER	6.00	7.00
AVG COLLECTION PERIOD (Days)	30.00	35.0
AVG PAYMENT PERIOD (Days)	50.0	45.0
FIXED-ASSET TURNOVER	6.75	7.0
TOTAL ASSET TURNOVER	2.5	2.5
PROFITABILITY RATIOS
RETURN ON TOTAL ASSET	0.05	0.05
RETURN ON NET WORTH	0.10	0.10
PROFIT MARGIN ON SALES	0.02	0.02
LEVERAGE RATIO
DEBT RATIO	0.65	0.60

Reference no: EM133378610

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