E12.24 (LO 4) (Ratio Computations and Analysis) EAN Ltd.’s condensed financial statements provide the following information (amounts in thousands).

EAN Ltd.

Statement of Financial Position December 31, 2025 December 31, 2024 Property, plant, and equipment ¥ 897,000 ¥ 853,000 Current assets Inventory ¥440,000 ¥360,000 Prepaid expenses 3,000 7,000 Accounts receivable 158,000 80,000 Short-term investments 80,000 40,000 Cash 52,000 733,000 60,000 547,000 Total assets ¥1,630,000 ¥1,400,000 Equity ¥ 990,000 ¥ 840,000 Bonds payable 400,000 400,000 Current liabilities 240,000 160,000

¥1,630,000 ¥1,400,000 Income Statement For the Year Ended 2025 Sales revenue ¥1,640,000 Cost of goods sold (800,000)

Gross profit 840,000 Selling and administrative expenses (480,000)

Interest expense (40,000)

Net income ¥ 320,000 Instructions

a. Determine the following for 2025.
1. Current ratio at December 31.
2. Acid-test ratio at December 31.
3. Accounts receivable turnover.
4. Inventory turnover.
5. Return on assets.
6. Profit margin on sales.

b. Prepare a brief evaluation of the financial condition of EAN Ltd. and of the adequacy of its profits.