Comparative fi nancial statement data for Loeb Corporation and Bowsh Corporation, two competitors, appear below. All balance sheet data are as of December 31, 2017. LO8 Loeb Corporation Bowsh Corporation 2017 2017 Net sales $1,800,000 $620,000 Cost of goods sold 1,175,000 340,000 Operating expenses 283,000 98,000 Interest expense 9,000 3,800 Income tax expense 85,000 36,000 Current assets 407,200 190,336 Plant assets (net) 532,000 139,728 Current liabilities 66,325 33,716 Long-term liabilities 108,500 40,684 Net cash provided by operating activities 138,000 36,000 Capital expenditures 90,000 20,000 Dividends paid on common stock 36,000 15,000 Weighted-average number of shares outstanding 80,000 50,000 Instructions

(a) Comment on the relative profi tability of the companies by computing the net income and earnings per share for each company for 2017.

(b) Comment on the relative liquidity of the companies by computing working capital and the current ratio for each company for 2017.

(c) Comment on the relative solvency of the companies by computing the debt to assets ratio and the free cash fl ow for each company for 2017.