2. (Financial ratios) The balance sheet and income statement for the R& H Mfg. Company are as follows:

R& HMfg., Inc. Balance Sheet ($000)

Cash

$500

Accounts receivable

2,000

Inventories

1,000

Current assets

3,500

Net fixed assets

4,500

Total assets

$8,000

Accounts payable

$1,100

Accrued expenses

600

Short-term notes payable

300

Current liabilities

$2,000

Long-term debt

2,000

Owners' equity

4,000

Total liabilities and owners' equity

$8,000

R& H Mfg., Inc. Income Statement ($000)

Net sales (all credit)

$8,000

Cost of goods sold

-3,300

Gross profit

$4,700

Operating expenses (includes $500 depreciation)

-3,000

Net operating income

$1,700

Interest expense

-367

Earnings before taxes

$1,333

Income taxes (40%)

-533

Net income

$ 800

Calculate the following ratios:

Current ratio -4

Times interest earned -

Inventory turnover -8

Total asset turnover

Operating profit margin

Operating return on assets

Debt ratio

Average collection period

Fixed asset turnover

Return on equity