Academy Control Systems has requested that you determine whether the company's ability to pay its current liabilities and long-term debts has improved or deteriorated during \(19 \mathrm{X} 2\). To answer this question, compute the following ratios for \(19 \mathrm{X} 2\) and 19X1:

(a) current ratio,

(b) acid-test ratio,

(c) debt ratio, and

(d) times-interest-earned ratio. Summarize the results of your analysis.

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19X2 19X1 Cash........ Short-term investments. Net receivables........ $ 21,000 $ 47,000 28,000 102,000 116,000 Inventory....... 226,000 263,000 Prepaid expenses.. 11,000 9,000 Total assets. 503,000 489,000 Total current liabilities. 205,000 241,000 Total liabilities........ 261,000 273,000 Income from operations. 165,000 158,000 Interest expense. 36,000 39,000