Evaluate the financial performance of the two companies and then determine which is the best as required below? Company X Company Y Item 1.11 1.14 1.20 1.26 2.05 5.49 4.02 4.85 8.97 0.17 0.15 0.20 4.78 urrent ratio uick ratio 0,41 0.42 0.43 0.44 0.76 Net cash from ating(Million) 121 9792 125 165 29 16 28 53 3 t cash from Investing (Million) Net cash from 1015 6 33 28 223 1 Financing (Million) 111 -79 -81-115 -115 -56-17 451 |244 1 246 0.24 0.25 0.22 0.20 0.19 0.36 0.35 0.37 0.35 0.42 0.17 0.18 0.16 0.15 0.15 0.12 0.03 0.12 0.11 0.12 Net cash (Million) 0 354 17 0 4 1 ross profit ma Net profit ma 0.15 0.17 0.19 0.19 0.24 0.03 0.01 0.03 0.04 eturn of Assets eturn of Equity 0.27 0.31 0.34 0.36 0.35 0.04 0.01 0.04 0.05 0.02 EPS Receivables Turnover 5.71 6.16 7.25 8.38 10.629.38 11.48 17.13 23.10 19.3 Inventories Turnover | 2.10 Assets Turnover 16.68 19.73 22.67 20.10 29.37 3.43 0.74 3.24 3.41 1.80 2.40 | 2.70 | 3.00 | 3.80 .301 0.30 | 0.30 0.40 | 0.30 0.90 1.00 1.20 1.401.80 0.20 0.20 0.20 0.30 0.20 0.76 0.75 0.78 0.80 0.81 064 0.65 0.63 0.65 0.58 0.28 0.29 0.23 0.09 ost of sales/ sales0 Liabilities/ Assets 0.45 045 0.46 0.47 0.32 A. In general, which company is better in liquidity and why? B. In general, which company is better in efficiency and why? c. In general, which company is better in profitability and why? o. In general, which company is more risky and why? E. Select at least three problems that each company has faced? F. In general and based in your answers, which company is better financial performance and why?
A) Comparing the quick ratio of company X and company Y, company Y\'s average quick ratio is greater than company X quick ratio. Thus company Y is in a better position to meet short term debt obligations than company Y and therefore company Y is better in liquidity.
B) Comparing the current ratio of company X and company Y, company X is more efficient than company Y because a smaller current ratio indicates less investment in current assets.
C) The net profit margin of company X is greater than that of company Y, hence company X is better in profitability than company Y.
d) Comparing the liabilities / assets ratio of company X and company Y, company X has a higher liabilities / assets ratio than company Y , hence company X is more risky than company Y as it has higher liabilities than company Y.
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