Riordan Manufacturings Financial Ratios

Riordan Manufacturings Financial Ratios Dr. Riordan, a professor of chemistry who obtained several(prenominal) patents fitting to processing polymers into high tensile potency charge cuticle substrates, represented Riordan Manufacturing. Riordan Manufacturing is a worldwide plastics manufacturer. The participation employs 550 people with probable hornswoggle of $46 million. The company is completely owned by Riordan Industries, a Fortune 1000 enterprise with revenues in surplus of $1 billion. This paper will summarize the pecuniary state of Riordan Manufacturing, Inc. (RMI) found numerous monetary symmetrys, used in conjunction with the financial statements, to analyze the companys financial condition. LIQUIDITY RATIOS: of a sudden SOLVENCY dining table 1: Current Ratio The on-line(prenominal) balance is the peak of the degree to which present-day(prenominal) assets cover current liabilities. A proportion of more than one suggests that it can pay mo st of its debts at that point in time. The ability to effectively turn products into interchange is a good sign of a companys financial state. The hobby table provides a comparison of Riordans current dimension for 2004 and 2005: 2005 2004 Current assets $14,555,092 2.09 times$14,643,4562.

43 times Current liabilities$6,974,094 $6,029,696 Current assets are change integrity by current liabilities to determine the current proportionality. Riordans current ratio is 2.09, and this suggests that the company is efficient in operating its business cycle. The persistence ratio is 2.04. Riordans current ratio is above perseverance average, which means that Riordan is a ble to meet short-run obligations or play ! short-term characterors. ACTIVITY RATIOS: ASSET LIQUIDITY, ASSET MANAGEMENT EFFICIENCY hedge 2: Accounts Receivable Turnover Ratio The accounts receivable (A/R) turnover ratio reflects the relationship between unpaid credit sales to good credit sales. It indicates, in general, the effectiveness (or lack of it) of a firms credit policies and cash collection...If you want to get a spacious essay, stray it on our website: OrderEssay.net

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