Problemreview the following 6 ratios for langley company, Ask an Expert

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Problem

Review the following 6 ratios for Langley Company and XYZ Inc. for the year ended 2014, and address the 2 questions below.

Ratio Name	Langley Company	XYZ Inc.
(a) Rate of return on total assets	21.5%	17.9%
(b) Debt ratio	25.0%	10.1%
(c) Accounts receivable turnover	8.3	7.5
(d) Price-Earnings ratio	25	19
(e) Inventory turnover	6.1	5.2
(f) Current ratio	1.96	3.12

Instructions: This is a 2-part question.

(1) Explain the meaning of each of the Langley Company ratios above.
(2) State which company performed better for each ratio.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M92826944

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