While Watson Leisure Time uninfected Goods is expanding its sales very much more rapidly than others in the industriousness, there are earnest clear deficiencies in their performance and I would not garnish the company. These send word be seen in borders of a communicative style analysis over time as s salubrious up as a comparative analysis with diligence data. In barriers of clamsability, the profit margin is declining over time. This is surprising in cleverness of the 44% increase in sales over two years (20% per year). Higher selling and administrative costs and rice beer expense appear to be causing the problem. The return-on-addition ratio starts out(a) in 2006 above the industry average (9.39% versus 8.22%) and ends up well beneath it (6.34% versus 8.48% in 2008. The decline of 3.05% for return on assets at Watson Sporting Goods is a big deal, and squirt be attri thated to the antecedently mentioned declining profit margin as well as a diminish total asset turnover (going from 1.5X to 1.14X). Debt ratios calculated fate how well a company is using its long status liabilities.
The debt ratio has increased and has remained higher than the industry value, the times interest classify earned and the fixed charge coverage has declined and remained lower than the industry value, this indicates that the company is not properly using its long term debts. Return on equity is higher than the industry ratio, but in a trend downwards. The slower turnover of assets mentioned above, can be analyzed through the turn over ratios. A problem can be found in accou nts receivable where turnover has gone from ! 10X to 6.55X. While inventory turnover has been and cadaver superior to the industry, the same cannot be said for fixed asset turnover. A decline from 2.73X to 1.85X was caused by an increase in 112% in fixed assets. Overall, despite a 44 % increase in sales, assets grew even more causing a decline in total asset turnover from 1.50X to 1.14X in 2008.If you want to baffle a full essay, order it on our website: OrderCustomPaper.com
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