Management's Discussion and Analysis of Rainbow Paint Company makes available the review of the financial results of the company for the period ended December 31, 2012. The following facts should be considered in combination with the audited financial statements and accompanying notes for the period ended December 31, 2012, which are prepared in accordance with appropriate principles and procedures. All amounts are shown in dollars unless otherwise noted. The Discussion contains some statements that may be deemed “forward-looking statements.” All statements made in the discussion, other than statements of historical fact, are called forward-looking statements since we have used what we know and expect today to make a decision about the future. The Company believes that the expectations presented in the forward-looking statements are based on rational expectations. The statements provide no assurance as to future performance and actual results or growth may vary materially from those indicated in the forward-looking statement. Forward-looking statements contain words such as may, expect, plan, anticipate, budget, believe or other similar words. Issues that could cause actual results to differ from forward-looking statements include market prices, government guidelines regarding the use of chemicals, sustainable availability of money, financing and general economic circumstances, as well as market or business circumstances. Investors are again cautioned that such reports do not promise future performance and that actual results or growth may not be the same as those projected in the forward-looking statements. Sales growth over the past few years has been reasonably strong, but i...... middle of paper ......iness growth is in flux. Company liquidity is OK as confirmed by the satisfactory current rate, quick ratio, working capital. In terms of Through the use of assets, the company is able to consume receivables quite competently, unlike inventories. The number of days taken to collect receivables is half the time taken to sell inventory. In terms of solvency, the company's position is not very strong as the company maintains an equal proportion of debt per relation to equity. The company earns about six times its interest expense. The profitability of the company during the year has been reasonable; it was neither too high nor too low. The company's earnings per share were $4.10 per share. The company's stock performance was also desirable. It distributed dividends, while maintaining the price/earnings ratio.