Ratio Analysis The following financial data are taken from the records of Big Brother Company.

Required:
1. Compute the following ratios for 2008 and 2009:

a. Current ratio

b. Debt ratio

c. Asset turnover

d. Return on sales

e. Return on equity 2. Have the firm’s performance and financial position improved from 2008 to 2009?
Explain.

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Assets: Cash Accounts receivable Inventory Big Brother Company Comparative Balance Sheet December 31 Property, plant, and equipment Total assets Liabilities and stockholders' equity: Current liabilities Noncurrent liabilities Stockholders' equity Total liabilities and stockholders' equity 2009 2008 $ 38,000 11,000 $ 23,000 15,000 220,000 195,000 70,000 70,000 $339,000 $303,000 $ 52,000 175,000 $ 36,000 170,000 112,000 97,000 $339,000 $303,000