Memo

To: Huffman Trucking CEO

From: Accounting Date: Re: Ratio Analysis

The Huffman Trucking Companys current assets rose to 4 !"# from $%!"# consistent &ith the attache' calculations of analysis of (ertical an' hori)ontal! An increment of !*%+# can ,e seen from year - to year . &hile looking at the Huffman Trucking Companys total Assets! As - to year ./ for the organi)ation/ it is a positi(e

the organi)ation is 'e(elope' in from year -

sign! Con(ersely/ in the pre(ious fi(e years/ Huffman Trucking Companys current lia,ilities sho&e' an increment to $+!0# from $-!0#! From year - to year ./ an increase of ! 00# - to ./ a 'rop

can ,e seen in the long term lia,ilities! 1n the pre(ious fi(e years/ from year -

to -"!4+# from $0!.-# can ,e seen in the Total E2uity of sharehol'er! 1n the Huffman Trucking Companys total lia,ilities/ an increase of !*%+# can ,e seen! 3o(ing in the 'irection of Huffman Trucking Companys income statement/ an increase of !0+$# is sho&n ,y the hori)ontal analysis in the re(enues! On the other han'/ there is also an increment of !0"*# in the companys operating e4penses! 1n relation to the companys (ertical analysis/ a 'rop to $!. # from 4!*-# can ,e seen in the organi)ations operating income! A 'rop to -!*+$# from -!-%# can also ,e seen in the total income of the Huffman Trucking Company! 5y taking a look at the organi)ations li2ui'ity ratio it 'emonstrates &hether the organi)ation is capa,le of paying ,ack short6term 'e,ts or not! 1n such form of ratio/ cre'itors &oul' ,e in(ol(e'! The picture of profita,ility ratios 'emonstrates the performance of the profit that helps in 'e(eloping the organi)ations success! This ratio &oul' ,e helpful for those in'i(i'uals &ho

are from outsi'e of the organi)ation for e4ample cre'itors an' in(estors! The capa,ility of the organi)ation for paying off the long6term 'e,ts is the 7ol(ency ratios! The sol(ency ratios of the Huffman Trucking Company concerne' &ith the organi)ations sharehol'ers an' the long6term cre'itors!

1n each category of ratios of Huffman Trucking company/ mostly tra'ers/ cre'itors/ suppliers/ or other staff is concerne'/ for e4ample: 8rofita,ility ratio 9 :o(ernment! ;i2ui'ity ratio 9 7uppliers/ :earing ratios 9 ;en'ers/ 8rofita,ility 6 Customers an' 3anagers! Capital Employe' ratio 9 Employees! The 'ata gathere' 'iscloses that o(er the pre(ious fe& years/ a tremen'ous gro&th has ,een e4perience' ,y the Huffman Trucking Company! The 'e(elopment is cause' ,y ha(ing long term contracts of :o(ernment for plastics manufacturing an' pops an' mom &ineries! 1n the in'ustry/ Huffman Trucking Company has al&ays ,een a frontrunner/ an' the main concern of the organi)ation is to satisfy the nee's of the customers! Huffman Trucking Company struggles for staying on top &ith e4pan'ing its locations in <e& =ersey/ Cle(elan'/ 7t! ;ouis/ an' ;os Angles an' &ith the intention of 'oing that/ the organi)ation ha(e to keep on fin'ing a''itional techni2ues for 'ecreasing their current lia,ilities or increasing their current assets!

Huffman Trucking Liquidity Ratios Current Ratio: Current assets>Current lia,ilities ? @***/%-+>@++/+-% ? *!-0+ Cash A accounts recei(a,les>Current lia,ilities ? @0*/""$ A @0./-"->@++/+-% ? @* +/-+0>@++/+-% ? *!-*"

Quick Ratio:

Huffman Trucking Profitability Ratios @ +%"/"44! 7ales Re(enue Di(i'e: A(erage Total Assets Assets Turnover -- / $!0

!!"!#$

-*-/-*"! 5eginning Total Assets --%/%++! En'ing Total Assets 44 / :ran' Total Di(i'e: - to get the a(erage Average Total Assets %%&'&& "( & %! -

<et 1ncome Di(i'e: <et 7ales

*"/-**! +%"/"44!

Profit Margin

%")*$

<et 1ncome Di(i'e: Total Assets Return on Total Assets 1ncome ,efore 1nterest E4pense Di(i'e: 1nterest E4pense Times interest earned ratio

*"/-**! --%/%++! *"+ $

$*/% -! %" ! +&")

Huffman Trucking ,olvency Ratios -ebt to total assets ?Total De,t > Total Assets B1n Thousan'sC ? B@++/+-% A @%*/%"$C > @--%/%++ ? % !0# Times interest earned ? 1ncome ,efore 1ncome Ta4es an' 1nterest E4pense > 1nterest E4pense B1n Thousan'sC ? @$*/% - > @%" ? 4 !* Times