$159,600 106,400 $53,200 Zach Industries Income Statement for the Year Ended December, 31, 2019 Sales revenue Less: Cost of goods sold Gross profits Less: Operating expenses Selling expense General and administrative expenses Lease expense Depreciation expense Total operating expense Operating profits Less: Interest expense Net profits before taxes Less: Taxes Net profits after taxes $16,400 10,300 I 970 10,100 $37,770 $15,430 5,500 $9,930 4,310 $5,620 Zach Industries Balance Sheet December 31, 2019 Assets Cash Marketable securities Accounts receivable Inventories Total current assets Land Buildings and equipment Less: Accumulated depreciation Net fixed assets Total assets $490 950 24,700 46,000 $72,140 $25,700 90,500 38,000 $78,200 $150,340 Liabilities and Stockholders' Equity Accounts payable $22,400 Notes payable 46,700 Total current liabilities $69, 100 Long-term debt $23,000 Common stock* $31,900 Retained earnings $26,340 Total liabilities and stockholders' equity $150,340 *The firm's 3,000 outstanding shares of common stock closed 2019at a price of $23 per share. Actual 2019 Ratio Industry average Current ratio 1.80 Quick ratio 0.70 Inventory turnover* 2.48 Average collection period 37.0 days Debt ratio 65.0% Times interest earned ratio 3.8 Gross profit margin 37% Net profit margin 2.9% Return on total assets 3.3% Return on common equitiy 7.8% Market/book ratio 1.0 *Based on a 365-day year and end-of-year figures. Actual 2018 1.84 0.78 2.57 36.0 days 67.0% 4.0 39% 3.0% 3.3% 6.3% 1.1 Financial statement analysis The financial statements of Zach Industries for the year ended December 31, 2019, follow a. Use the financial statements to complete the following table Assume the industry averages given in the table are applicable for both 2018 and 2019 b. Analyze Zach Industries financial condition as it is related to (1) liquidity. (Z) activity. (3) debt, (4) profitability, and (5) market. Summarize the company's overall financial condition a. The current ratio ls . (Round to two decimal places.) The quick ratio is (Round to two decimal places.) The inventory tumover is. (Round to two decimal places.) The average collection period is days. (Round to one decimal place) The debt ratio is %. (Round to one decimal place.) The times interest earned ratio is (Round to one decimal place.) The gross profit margin is [% (Round to one decimal place.) The net praft margin is % (Round to one decimal place.) The retum on mooton (Round to one decimal place) The retum on common equity is % (Round to one decimal place.) The market book value is (Round to two decimal place) The marbook van bound to sera place! B. Andyan Zach Industries francal condition m tie med to quity, tiety..probond Sure the company's overall financial condition Select the wholy) DA Liquidity: Zach nur day portion has deteriorated from 2018 2019 and is in the dusty average. There may not be able to stay ho tem obligations as they come do O Activity Tachwytowcaserted to 2018 2019. on the case of the 20-day increase in the celection period is wat vertory now has wo decreased for the period under review and is for Dc Detached deposition to proveden 2018 and wage Tech Indore to servieren dered and below they are ndiyo ndicating color rosa felprofit margin comparison to average. The firm has an average operating expenses. The form has a priorum on weet income one the industry and how E Market Zach Indecene in the market price is the aut persendicates that is performance has been interpreted as more positie 2013 in 2018 and a high endly $159,600 106,400 $53,200 Zach Industries Income Statement for the Year Ended December, 31, 2019 Sales revenue Less: Cost of goods sold Gross profits Less: Operating expenses Selling expense General and administrative expenses Lease expense Depreciation expense Total operating expense Operating profits Less: Interest expense Net profits before taxes Less: Taxes Net profits after taxes $16,400 10,300 I 970 10,100 $37,770 $15,430 5,500 $9,930 4,310 $5,620 Zach Industries Balance Sheet December 31, 2019 Assets Cash Marketable securities Accounts receivable Inventories Total current assets Land Buildings and equipment Less: Accumulated depreciation Net fixed assets Total assets $490 950 24,700 46,000 $72,140 $25,700 90,500 38,000 $78,200 $150,340 Liabilities and Stockholders' Equity Accounts payable $22,400 Notes payable 46,700 Total current liabilities $69, 100 Long-term debt $23,000 Common stock* $31,900 Retained earnings $26,340 Total liabilities and stockholders' equity $150,340 *The firm's 3,000 outstanding shares of common stock closed 2019at a price of $23 per share. Actual 2019 Ratio Industry average Current ratio 1.80 Quick ratio 0.70 Inventory turnover* 2.48 Average collection period 37.0 days Debt ratio 65.0% Times interest earned ratio 3.8 Gross profit margin 37% Net profit margin 2.9% Return on total assets 3.3% Return on common equitiy 7.8% Market/book ratio 1.0 *Based on a 365-day year and end-of-year figures. Actual 2018 1.84 0.78 2.57 36.0 days 67.0% 4.0 39% 3.0% 3.3% 6.3% 1.1 Financial statement analysis The financial statements of Zach Industries for the year ended December 31, 2019, follow a. Use the financial statements to complete the following table Assume the industry averages given in the table are applicable for both 2018 and 2019 b. Analyze Zach Industries financial condition as it is related to (1) liquidity. (Z) activity. (3) debt, (4) profitability, and (5) market. Summarize the company's overall financial condition a. The current ratio ls . (Round to two decimal places.) The quick ratio is (Round to two decimal places.) The inventory tumover is. (Round to two decimal places.) The average collection period is days. (Round to one decimal place) The debt ratio is %. (Round to one decimal place.) The times interest earned ratio is (Round to one decimal place.) The gross profit margin is [% (Round to one decimal place.) The net praft margin is % (Round to one decimal place.) The retum on mooton (Round to one decimal place) The retum on common equity is % (Round to one decimal place.) The market book value is (Round to two decimal place) The marbook van bound to sera place! B. Andyan Zach Industries francal condition m tie med to quity, tiety..probond Sure the company's overall financial condition Select the wholy) DA Liquidity: Zach nur day portion has deteriorated from 2018 2019 and is in the dusty average. There may not be able to stay ho tem obligations as they come do O Activity Tachwytowcaserted to 2018 2019. on the case of the 20-day increase in the celection period is wat vertory now has wo decreased for the period under review and is for Dc Detached deposition to proveden 2018 and wage Tech Indore to servieren dered and below they are ndiyo ndicating color rosa felprofit margin comparison to average. The firm has an average operating expenses. The form has a priorum on weet income one the industry and how E Market Zach Indecene in the market price is the aut persendicates that is performance has been interpreted as more positie 2013 in 2018 and a high endly