31. Vance Motors has current assets of $1.2 million. The company's current ratio is 1.2, its quick ratio is 0.7, and its inventory turnover ratio is 4. The company would like to increase its inventory turnover ratio to the industry average, which is 5, without reducing its sales. Any reductions in inventory will be used to reduce the company's current liabilities. What will be the company's current ratio, assuming that it is successful in improving its inventory turnover ratio to 5? a. 1.33 b. 1.67 c. 1.22 d. 0.75 32.The following ratios and data were computed from the 1997 financial statements of Star Co.: Current ratio 1.5 Working capital P20,000 Debt/equity ratio .8 Return on equity .2 If net income for 1997 is P40,000, the balance sheet at the end of 1997 total assets of a. P340,000 b. P360,000 c. P300,000 d. P400,000 33. An enterprise has total asset turnover of 3.5 times and a total debt to total assets ratio of 70%. If the enterprise has total debt of $1,000,000, it has a sales level of A. $5,000,000.00 B. $2,450,000.00 C. $408,16 35. 35. The Meryl Corporation's common stock is currently selling at $100 per share, which represents a P/E ratio of 10. If the firm has 100 shares of common stock outstanding, a return on equity of 20 percent, and a debt ratio of 60 percent, what is its return on total assets (ROA)? a. 8.0% b. 10.0% c. 12.0% d. 16.7% 36.A firm has total assets of $1,000,000 and a debt ratio of 30 percent. Currently, it has sales of $2,500,000, total fixed costs of $1,000,000, and EBIT of $50,000. If the firm's before-tax cost of debt is 10 percent and the firm's tax rate is 40 percent, what is the firm's ROE? a. 1.7% b. 2.5% c. 6.0% d. 8.3%