Use the following balance sheet to answer the subsequent questions:

As you can see, total liabilities and owner’s equity equal the total assets.

a. What is the year-to-year percentage change in the value of the following:

• inventory

• accounts payable

• land

• taxes payable

• liabilities and owner’s equity

b. What is the ratio of the following:

• Cash equivalent to inventory in 2014? How did it change from 2013?

• Owner’s equity to total assets in 2014? How did it change from 2013?

c. Investors and buyers like to put their money into companies that have a low ratio of liabilities to assets. Has that ratio become more or less appealing from 2013 to 2014?

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Jean M's Florida-Style Subs, Inc. Balance Sheet December 31, 2013 and 2014 2014 2013 Assets Current Assets Cash and cash equivalents $10,000 $10,000 Accounts receivable 2,000 7,000 Inventory 20,000 25,000 Total Current Assets $32,000 $42,000 Fixed Assets Plant and machinery $5,000 $9,000 Land 9,000 8,000 TOTAL ASSETS $46,000 $59,000 Liabilities Accounts payable Taxes payable $10,000 $15,000 6,000 5,000 Total Liabilities $16,000 $20,000 OWNER'S EQUITY $30,000 $39,000 LIABILITIES and OWNER'S EQUITY $46,000 $59,000