1. DENVER MANUFACTURING CORPORATION RATIO ANALYSIS

2. DIVISION A STRENGTHS WEAKNESSES Financial Statements  Current Ratio of 2.67  Quick Ratio of 1.59  Avg. Days of Inventory of 60.38  Debt to Asset Ratio of 41.85%  Return on Sales of 4.76%  Return on Assets of 0.15  Return on Equity of 0.18  Avg. Collection Period of 60.38 Days

3. DIVISION B STRENGTHS WEAKNESSES Financial Statements  Debt to Asset Ratio of 22.71%  Return on Sales 9.08%  Return on Assets 0.23  Return on Equity 0.22  Avg. Collection Period of 41.39 Days  Avg. Days of Inventory 60.11  Current Ratio of 3.63  Quick Ratio of 2.23

4. DIVISION C STRENGTHS WEAKNESSES Financial Statements  Quick Ratio of 1.82  Debt to Asset Ratio of 29.48%  Return on Sales of 9.7%  Return on Assets of 0.29  Return on Equity of 0.30  Avg. Collection Period of 39.67 Days  Avg. Days of Inventory of 61.81  Current Ratio of 3.07

5. COMBINED DIVISIONS STRENGTHS Financial Statements  Quick Ratio 1.84  Debt to Asset Ratio 30.7%  Return on Sales 7.93%  Return on Assets 0.22  Return on Equity 0.24  Avg. Collection Period of 42.13 Days  Avg. Days of Inventory of 60.77

6. RATIOS COMPARISON Division A Division B Division C Consolidated Current Ratio2.673.633.073.06 Quick Ratio1.592.231.821.84 Debt to Asset Ratio41.85%22.71%29.48%30.70% Return on Sales4.76%9.08%9.70%7.93% Return on Assets0.150.230.290.22 Return on Equity0.180.220.300.24 Average Collection Period45.6341.3939.6742.13 Average Days of Inventory60.3860.1161.8160.77

7. COMPARISONS

8. AREAS NEEDING IMPROVEMENT Current Ratio –The ratio is too high, meaning more profit should be earned on the current assets.  Solution: Improve cash management.