1. Calculate the 12 ratios for Bluffton pharmacy for this year.

2. How do the ratios you calculated for this year compare to those for the pharmacy last year?

Case 6 Bluffton Pharmacy wo New Pharmacy Owners Learn valuable Lessons About Financial statements and Analysis has been a little more than two years since Angela Craw- and and Martin Rodriguez purchased the Bluffton Pharmacy from Frank White, the previous owner and founder, who had started the pharmacy in 1969. The two have spent many long houts in the store and have learned many valuable lessons as business owners that they had not had the opportunity to learn as employees of large chain pharmacies where they had previously worked Crawford and Rodriguez just received an e-mail from their accountant that contained the balance sheet and the come statement for Bluffton Pharmacy for the fiscal year that has just ended. The two financial statements appear below. Bluffton Pharmacy Balance Sheet, December 31, 20XX Current Assets Assets Cash Accounts Receivable Inventory Supplies Other Assets Total Current Assets $ 74,473 $112,730 $224.870 $ 21,577 10,202 S443,851 Fixed Assets Autos, net Equipment, net Furniture and Fixtures, net Total Fixed Assets Total Assets $ 33,156 S 35,706 $ 16,323 S 85,185 S529,036 Liabilities Current Liabilities Accounts Payable Notes Payable Line of Credit Payable Total Current Liabilities Long-term Liabilities Note Payable Loan Total Long-term Liabilities $ 29,585 $ 70,902 $ 32.136 $132.623 $170,880 S 93,346 S264.226 Crawford and Rodriguez, Capital Total Liabilities and Owner's Equity Owner's Equity S132,187 $529,036 779 UTROSU Bluffton Pharmacy Income Statement December 31, 20XX $2,228,767 $ 167,757 $2,396,524 Prescription Sales Revenue All Other Sales Revenue Total Sales Cost of Goods Sold Beginning Inventory, 1/1/xx + Purchases Goods Available for Sale -- Ending Inventory, 12/31/xx Cost of Goods Sold $ 169,578 $1,938,097 $2,107,675 $ 224,870 $1,882,805 $ 513,719 Gross Profit Operating Expenses Utilities Rent Advertising Insurance Depreciation Salaries and Benefits Computer and E-commerce Repairs and Maintenance Travel Professional Fees Supplies Total Operating Expenses $ 10,305 $ 35,948 $ 9,586 $ 9,586 $ 5,033 $ 321,134 $ 11,983 $ 28,758 $ 4.793 $ 3,595 $ 5,991 $ 446,712 Other Expenses Interest Expense Miscellaneous Expense Total Other Expenses $ S 24,879 374 $25,253 Total Expenses $ 471.965 Net Income $ 41,754 To see how their pharmacy's financial position has the typical small pharmacy in the industry. The table below changed since their first full year of operation, Crawford_shows the value of each of the twelve ratios from last year and Rodriguez want to calculate 12 financial ratios. They and the industry median for small pharmacies. also want to compare Bluffton Pharmacy's ratios to those of 780 Ratio Comparison Bluffton Pharmacy Current Year Last Year Pharmacy Industry Median* Ratio Liquidity Ratios Current ratio Quick ratio 3.41 1.72 4.71 2.42 Leverage Ratios Debt ratio Debt-to-Net Worth ratio Times Interest earned ratio 0.70 2.23 3.04 0.62 2.1 3.9 Operating Ratios Average Inventory Turnover ratio Average Collection Period ratio Average Payable Period ratio Net Sales to Total Assets ratio 10.90 14.0 5.0 4.75 11.7 times/year 15.0 days 14.0 days 4.68 Profitability Ratios Net Profit on Sales ratio 1.94% Net Profit to Assets ratio 9.20% Net Profit to Equity ratio 29.21% *from Risk Management Association Annual Statement Studies and National Community Pharmacists Association 2.9% 8.2% 48.0%