1. The Caraway Seed Company grows heirloom tomatoes and sells their seeds. The heirloom tomato plants are preferred by many growers for their superior flavor. At the end of the most recent year the firm had current assets of $51,000, net fixed assets of $250,800, current liabilities of $31,500,

and long-term debt of $100,200.

a.Calculate Caraway's stockholders' equity

.b. What is the firm's net working capital?

c.If Caraway's current liabilities consist of $18,900 in accounts payable and $12,600 in short-term debt (notes payable), what is the firm's net working capital?

2. The Karson Transport Company currently has net operating income of $490,000 and pays interest expense of $199,000.The company plans to borrow $1.08 million on which the firm will pay 9 percent interest. The borrowed money will be used to finance an investment that is expected to increase the firm's net operating income by $391,000 a year

.a. What is Karson's times interest earned ratio before the loan is taken out and the investment is made?

b. What effect will the loan and the investment have on the firm's times interest earned ratio?

3. In 2016, the Allen Corporation had sales of $63 million, total assets of $40 million, and total liabilities of $15 million. The interest rate on the company's debt is 6.3 percent, and its tax rate is 35 percent. The operating profit margin is 14 percent.

a. Compute the firm's 2016 net operating income and net income

.b. Calculate the firm's operating return on assets and return on equity. (Hint: You can assume that interest must be paid on all of the firm's liabilities.)