Ten ratios, a three-part DuPont split and a sheet of figures saved for later units, all from one barge operator's statements, make up this GB550 Unit 1 ratio groundwork exercise. Searches like "gb 550 unit 1 assignment example", "gb550 unit 1 sample" and "gb550 unit 1 example" land here.
What a finished GB550 Unit 1 ratio groundwork exercise looks like
About five pages: two common-size statements, a ratio table, a DuPont line and a one-page carry-forward sheet. Revenue of 612.4 million dollars produces EBITDA of 156.5 million, a 25.6 percent margin, and net income of 46.1 million after 24.6 million of interest. Vessels and barges make up 86.4 percent of 1.18 billion in assets, so assets turn only 0.52 times a year. The current ratio is 1.11 and the quick ratio 0.97. Debt of 420 million stands at 2.68 times EBITDA, and operating income covers interest 3.47 times. Return on equity of 8.54 percent is split into a 7.53 percent margin, that 0.52 turnover and an equity multiplier of 2.19, then set beside last year's 9.55 percent so the decline has to be explained rather than merely reported.
How a GB550 Unit 1 example is structured
The exercise treats every ratio as an input to be kept, not a score to be read once. Common-size statements come first, each line shown as a share of revenue or of assets, which reveals at a glance that depreciation takes 11.6 cents of every revenue dollar. The ratio table follows in four groups, liquidity, leverage, efficiency and return, each row carrying its formula, the two statement figures used, this year and last year. A DuPont paragraph then accounts for the fall in return on equity: margin slipped from 8.47 to 7.53 percent while turnover and leverage barely moved. The carry-forward sheet closes the work, listing figures later units will need, such as debt at book value, interest expense, the 24 percent tax rate, shares outstanding, the dividend and the payout, each tagged with the unit expected to use it.
Common size before ratios
Every income statement line is shown as a share of 612.4 million in revenue, so fuel, crew costs and depreciation can be compared before any ratio divides one line by another.
Four groups, one row format
Liquidity, leverage, efficiency and return each open with the question the group answers, and every row shows its formula, its inputs and two years side by side.
Why the assets turn slowly
An asset turnover of 0.52 is traced to a fleet carried at 1.02 billion, and the paper says why a river carrier should never be judged against a retailer's turnover.
Return on equity, taken apart
The DuPont split traces the drop from 9.55 to 8.54 percent to margin alone, since turnover and the 2.19 equity multiplier held almost level.
A sheet for the later units
Debt, interest, the tax rate, 28.4 million shares, the 0.96 dividend and a 59 percent payout are listed once, each tagged with the unit expected to reuse it.
Where marks go in GB550 Unit 1
Ratios reported as bare numbers draw the heaviest deductions in this opening unit, because the prompt commonly asks what each figure says about the firm rather than whether the division was done. A current ratio of 1.11 means little until it is set against last year or an industry reading. Formulas mixing book and market figures, or dividing by year-end assets in one row and average assets in the next, cost method credit. Graders also note ratios computed for a capital-heavy carrier and then judged against rules of thumb built for merchandisers. A DuPont split that restates return on equity without saying which factor moved answers only half the question. Groundwork that never records the inputs later units need leaves the cost of capital work to start over from the statements.
Get a GB550 Unit 1 example written to your instructions
Name the company on your assignment sheet, or the firm you chose yourself, and attach its statements with the Unit 1 instructions and rubric. Ratios come back grouped and computed with formulas shown, the DuPont split explained, and a carry-forward sheet built for the units ahead. The opening custom sample is free and normally arrives within 24-48h.
GB550 Unit 1 questions, answered
Why does the sample use common-size statements before the ratios?
Because they show where the money goes before ratios compress it into comparisons. A barge operator spends heavily on depreciation and fuel, and a common-size statement makes that visible in one column. Some sections do not require the step, but it gives the ratio commentary a starting point and helps a grader see why a margin moved rather than only that it did.
Should the ratios be compared with an industry average?
Usually, since most prompts ask for one by the second or third unit. Published figures for inland marine carriers are thin, so the sample leans on the prior year and on two composite peers, and says so. The custom version uses whatever benchmark source your section names or your library database provides, with the source cited beside the table.
What is the carry-forward sheet for?
It keeps later units consistent. The cost of capital estimate needs debt, the tax rate and share count; the stock valuation needs the dividend and payout; capital budgeting needs the tax rate again. Recording each figure once, with its source, prevents the common problem of a number changing between units without explanation. Not every section asks for it, and it can be dropped if yours does not.