12. Based on the following financial statements for Newport Heavy Industries, Inc., on the following pages please: a) write the formula for the following ratio, b) calculate the ratio, c) give a Rule of Thumb for the ratio There are 1,000,000 common shares authorized, 100,000 issued and 2,000 shares in the treasury. Newport Heavy Industry, Inc. Financial Statement 9/30/2020 Newport Heavy Industry, Inc. Financial Statement Fiscal Year Ending 9/30/20 ($000) ($000) Cash and Marketable Securities $250 Accounts Receivable 375 Less Allowance for Bad Debts (5) Gross Revenues $1,725 370 Less Returns (23) Prepaids Items Inventory 15 Subtotal 1,702 750 Cost of Goods Sold (895) Subtotal 1,385 Subtotal 807 Fixed Assets 525 Less Allowance for Depreciation (137) Subtotal Other Assets Total Accounts Payable Depreciation Operating Expenses 388 Subtotal 430 15 Net Interest Expense 48 1,788 Subtotal 382 153 25 352 Taxes Payable Salaries Payable Other Accrued liabilities Subtotal Due Bank in 2025 Capital Retained Earnings Dividends FORMULA Return on Sales Subtotal 182 Tax 49 77 Total $229 10 318 404 722 35 1,035 1,070 (4) 1,066 Subtotal Total $1,788 CALCULATION RULE OF THUMB Return on Equity Debt/Equity Current Ratio Working Capital Quick Ratio FORMULA CALCULATION RULE OF THUMB Days Sales Outstanding GP% NCF EBITDA Book Value of Company Book Value of Company /Share Market Value of the Company