Huffman Trucking Current Financial Position

Liquidity Ratio This take opposes the frequent financial dimension habituate to test a associations liquidity by deriving the portion of reliables assets available to cover stream liabilities. This command consists of dividing the on-line(prenominal) assets by the contemporary liabilities. In the case of Huffman Trucking, the up-to-the-minute assets represent $ 111, 728; accredited liabilities represent $ 88, 827. When applying the formula, the online proportion comes decompose through to 1.3. This formula is called the occurrent ratio. This number measures the short marches power to pay maturing obligations (Weygandt, Kimmel, & Kieso, 2010) and to action unexpected needs for cash. This ratio is a more just than a working majuscule ratio. after review of this ratio, it seems as though there seems to be a lack of current assets to signify a legal ratio in our opinion. We urge on reducing current liabilities in coiffe to obtain a healthier ratio. This could be do by perhaps investiture in a yen term liability influx of cash to boost the current assets or reducing the current liabilities. Profitability Ratio For this atomic number 18a, we opted to use the pass away on assets ratio. Return on assets is a measure of how efficaciously the self-coloreds assets are being used to arrest lolly (Weygandt, Kimmel, & Kieso, 2010).

Return on assets is work out by dividing terminal income by medium assets. aft(prenominal) doing the calculations, we took $ 19,211 by $ 220,003 ( average out for the past dickens years). We obtained an average of 8.7%. We feel this is high than the industry average scarcely not as peachy as it could be. Landstar Systems has an average of 15.36 (YCharts, July 2010). This is high, exclusively we would recommend striving for a double digit average on this ratio. Solvency Ratio For the solvency ratio, we opted to look at that debt to agree assets ratio. This formula is calculated by dividing total debt (both current and long-term liabilities) by total assets. This number will progress indicate the companys pointedness of leverage. Currently,...If you want to support a full essay, magnitude it on our website: Orderessay

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