Comparative financial statements for The Rose Packing Corporation are shown below 

Additional information: 

1. All sales were on account. 

2. The allowance for doubtful accounts was $5,500 in 2024 and $4,500 in 2023. 

3. In 2024, $23,620 of dividends were paid to the common shareholders. 

4. Cash provided by operating activities was $116,780. 

5. Cash used by investing activities was $51,660. 

Instructions 

Calculate all possible liquidity, solvency, and profitability ratios for 2024. 

Based on the ratios you have calculated for 2024, can you determine whether Rose Packing’s liquidity, solvency, and profitability are strong or weak? If not, what additional information would you require?

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THE ROSE PACKING CORPORATION Income Statement Year Ended December 31 2024 $790,000 540,000 Net sales Cost of goods sold Gross profit Operating expenses Profit from operations Interest expense Loss on sale of equipment Profit before income tax Income tax expense Profit for the year 250,000 153,880 96,120 3,200 6,720 86,200 12,930 $ 73,270 2023 $624,000 405,600 218,400 149,760 68,640 1,200 6,000 61,440 9,216 $ 52,224