SOLUTIONS FOR RATIO ANALYSIS:

Ratio Tests 2008 2007

Current Ratio =582,695/784,792 =555,801/771,474

=Current Assets / Current =0.74248 =0.72044
Liabilities
Quick Ratio =(336,818+134,569)/784,792 =(319,978+127,841)/771,474
=Quick Assets / Current = 0.6007 =0.5805
Liabilities
Receivable Turnover =8,079,445/ (134,569/360) =7,756,268/(127,841/360)
=Net Credit Sales / =21614.35 =21841.64
Average Receivables
Inventory Turnover =0 =0
=Cost of Goods sold / (Service Entity) (Service Entity)
Average Merchandise
Inventory
Raw Materials Turnover =0 =0
=Cost of Raw Materials / (Service Entity) (Service Entity)
Average Raw Materials
Inventory
Goods in Process =0 =0
Turnover (Service Entity) (Service Entity)
=Cost of Goods
Manufactured / Average
Goods in Process
Manufactured
Finished Goods =0 =0
Turnover (Service Entity) (Service Entity)
=Cost of Goods Sold /
Average Finished Goods
Inventory
Payables Turnover =0 =0
=Net Credit Purchases / (Service Entity) (Service Entity)
Average Trade Payables
Current Asset Turnover =(7,945,326-122,001) / =(7,620,193-115,901) /
=(Cost of Sales+ (582,695 / 360) (555,801 / 360)
Operating Expenses) / =4833.398 =4860.6
Average Current Assets
Times Interest Earned = 45,458 + 72,301 / 72,301 = 52,094 + 68,439 / 68,439
=(Income Before Tax + =1.628733 =1.7612
Interest Expense) / Interest
Expense
Debt-Equity Ratio =1,121,601/95,013 =1,070,826/79,113
= Total Liabilities / Total =11.805 =13.535
Owner’s Equity

Debt Ratio =1,121,601/1,216,614 =1,070,826/1,149,939

=Total Liabilities / Total =0.9219 =0.9312
Assets
Equity Ratio =95,013/1,216,614 =79,113/1,149,939
=Totals Owner’s Equity/ = 0.0781 =0.0688
Total Assets
Net Profit Ratio =23,581/8,079,445 =31,024/7,756,268
=Net Profit/Net Sales =0.0029 =0.004

Gross Profit Ratio =8,079,445/8,079,445 =7,756,268/7,756,268

=Gross Profit/ Sales =1 =1
Return on Asset =(117,759+21,877) / =(120,533+21,070)/
=(Income Before Interest 1,216,614+1,149,939)/2 1,149,939
Expense + Income Tax)/ =0.118 =0.12313958
Average Total Assets

Return on Owner’s =23,581/(95,013+79,113) =31,024/79,113

Equity =0.1354 =0.3921
=Net Income / Average
Owner’s Equity
Earnings Per Share Not Corporation Not Corporation
=Net Income – Preferred /
Weighted Average
Number of Common
Shares
Price-Earnings Ratio Not Corporation Not Corporation
=Price Per share/Earnings
Per Share
Dividend Yield Not Corporation Not Corporation
=Dividend Per share/Price
per Share
Dividend Payout Not Corporation Not Corporation
=Common Dividend Per
Share/Earnings Per Share
 Liberty Medical Group
Ratio Analysis - Two-Year Comparison

2008 2007
Liquidity Ratios
Current Ratio 0.7 0.7
Acid Test Ratio- Quick Ratio 0.6 0.6
Receivable Turnover 21.61 21.84
Inventory Turnover 0 0
Raw Materials Turnover 0 0
Goods in Process Turnover 0 0
Finished Goods Turnover 0 0
Payables Turnover 0 0
Current Asset Turnover 4833.40 4860.6

Test of Solvency
Times Interest Earned 1.63 1.76
Debt-Equity Ratio 11.81 13.54
Debt Ratio 0.92 0.93
Equity Ratio 0.08 0.07
Net Profit Ratio 0.003 0.004
Gross Profit Ratio 1 1

Test of Profitability
Return on Asset 0.12 0.12
Return on Owner’s Equity 0.14 0.39
Earnings Per Share N/A N/A

Market Test
Price-Earnings Ratio N/A N/A
Dividend Yield N/A N/A
Dividend Payout N/A N/A