Ryan Boot Company Analysis.

Problem:

A. Analyze Ryan Boot Company, using ratio analysis. Compute the ratios.

B. In your analysis, calculate the overall break-even point in sales dollars and the cash break-even point.

Ryan Boot CompanyAnalysis Ratios Ryan BootIndustryProfit margin$292,500 ÷ 7,000,0004.18%5.75%Return on assets$292,500 ÷ 8,130,0003.60%6.90%Return on equity$292,500 ÷ 2,880,00010.16%9.20xReceivables turnover$7,000,000 ÷ 3,000,0002.33×4.35xInventory turnover$7,000,000 ÷ 1,000,0007.00×6.50xFixed asset turnover$7,000,000 ÷ 4,000,0001.75×1.85xTotal asset turnover$7,000,000 ÷ 8,130,0000.86×1.20xCurrent ratio$4,130,000 ÷ 2,750,0001.50×1.45xQuick ratio$3,130,000 ÷ 2,750,0001.14×1.10xDebt to total assets$5,250,000 ÷ 8,130,00064.58%25.05%Interest coverage$700,000 ÷ 250,0002.80×5.35xFixed charge coverage($700,000 + $200,000)/$250,000 + $200,000 + ($65,000/ (1-.35) = $900,000/$550,0001.64×4.62x

Answer:

B. BEP in sales dollars

First we

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