the brick vs.

leons
Income statement The brick Leons
Net sales 1,214,405 547,744
Cost of goods 739,505 323,629
Gross profit 474,900 224,115
operating expenses 440,203 170,048
income from operations 34,697 54,067
other income 1,087 20,658
interest expense 5,233
Income before Tax 30,551 74,725
Income tax expense 1,232 25,761
net income 29,319 48,964

Balance sheet The brick Leons

cash & equivalents 29,201 20,592

A/R 54,192 20,705
Inventories 193,670 72,644
Other current assets 7,310 75,749
Total current assets 284,373 189,690
plant, property & equipment 602,241 182,023
other assets 37,286 9,989
TOTAL ASSETS 923,900 381,702

current liabilites 278,213 99,579

L/T liabilites 167,298 21,685
Total liabilities 445,511 121,264
Shareholders equity 478,389 260,438
T.L. + shareholders equity 923,900 381,702

average A/R 45862 19234

average inventories 181266 71962
average total assets 892,000 376316
average shareholders equity 494890 255152
# of outstanding common shares 750,000 368,000
dividend 20,000 25,000
a) using the information above calculate ratios for each company to test their profitability, liquidity,
solvency & market value.

b) comment on each companys profitability, liquidity, solvency & market value.

c) based on the information above, which one is the better investment? give reasons for your
answer.
b) comment on each companys profitability, liquidity, solvency & market value.

c) based on the information above, which one is the better investment? give reasons for your
answer.
 The brick Leons
Profitability
Gross profit margin
EBIT
EBIT to percentage of sales
Net profit margin
Return on equity
Return on assets
Asset turnover
Liquidity
Current ratio
quick ratio
DSO
ART
Inventory days on hand
inventory turnover
solvency & market value
Interest coverage
debt to equity ratio
Debt to assets
Book value per share
dividend payout
EPS