Reference no: EM132049720

Balance Sheets 2015 2016 Assets Cash $ 52,000 $ 57,600 Accounts receivable 402,000 351,200 Inventories 836,000 715,200 Total current assets $1,290,000 $1,124,000 Gross fixed assets 527,000 491,000 Less accumulated depreciation 166,200 146,200 Net fixed assets $ 360,800 $ 344,800 Total assets $1,650,800 $1,468,800 Liabilities and Equity Accounts payable $ 175,200 $ 145,600 Notes payable 225,000 200,000 Accruals 140,000 136,000 Total current liabilities $ 540,200 $ 481,600 Long-term debt 424,612 323,432 Common stock (100,000 shares) 460,000 460,000 Retained earnings 225,988 203,768 Total equity $ 685,988 $ 663,768 Total liabilities and equity $1,650,800 $1,468,800 Income Statements 2016 2015 Sales $3,850,000 $3,432,000 Cost of goods sold (3,250,000) (2,864,000) Other expenses ( 430,300) ( 340,000) Depreciation ( 20,000) ( 18,900) Total operating costs $3,700,300 $3,222,900 EBIT $ 149,700 $ 209,100 Interest expense ( 76,000) ( 62,500) EBT $ 73,700 $ 146,600 Taxes (40%) ( 29,480) ( 58,640) Net income $ 44,220 $ 87,960 EPS $0.442 $0.880 Please use the financial statements above to answer the questions below. Show your work. Calculate the current ratio for 2016. (Current Ratio = Current Assets / Current Liabilities) Calculate the quick ratio for 2016. (Quick Ratio = (Current Assets – Inventory) / Current Liabilities. Calculate the debt ratio for 2016. (Debt Ratio = Total Liabilities / Total Assets) Calculate the times interest earned ratio for 2016. (Times Interest Earned TIE = EBIT / Interest Charges) Calculate the profit margin for 2016. (Net Profit Margin = Net Income / Sales). Calculate the return on assets for 2016. (Return On Assets ROA= Net Income / Total Assets)