Carolina Company Computed the Following Ratios for a Two-Year Period

question 28

Essay

Carolina Company computed the following ratios for a two-year period: $\begin{array}{lcc}\text { Ratio }&2013&2014\\1.\text { Current ratio } & 1.3 & .6 \\2.\text { Return on equity } & 25 \% & 16 \% \\3.\text { Quality of income } & 1.7 & .5 \\4.\text { Cash coverage ratio } & 346 & 122 \\5.\text { Profit margin } & 6 \% & 4 \%\end{array}$ Required:
A. Comment on the trend of each of the ratios from 2013 to 2014. State concerns or possible implications brought to light by each ratio.
B. State an overall opinion of the company's near future with suggestions for improvement.

---

Definitions:

Autism

A developmental disorder characterized by difficulties in social interaction, communication, and by restricted and repetitive behavior.

Causal Factors

Elements or conditions that directly contribute to the occurrence of an event, phenomenon, or condition, determining its form, existence, or outcome.

Stranger Anxiety

Refers to the fear or distress that infants commonly show when approached or held by someone unfamiliar to them.

Laboratory Setting

A controlled environment where scientific experiments, investigations, and tests are carried out in order to obtain data and insights.