4-1: . You work as an analyst for the ACE Corporation and need to assess the firm's liquidity and cash position. You have access to the following financial statement information for the company: Income Statement Sales Cost of goods sold Gross profit Fixed expenses EBITDA Depreciation EBIT Interest expense EBT Taxes (40%) Net Income 2016 920,000 340,000 580,000 310,000 270,000 160,000 110,000 67,000 43,000 17,200 25,800 2015 890,000 350,000 540,000 210,000 330,000 160,000 170,000 67,000 103,000 41,200 61,800 Balance Sheet Cash Accounts receivable Inventory Land and building Machinery Other fixed assets Accounts payable Notes payable Long-term debt Common stock Retained earnings 2016 72,000 44,000 90,000 238,000 122,000 141,000 105,000 98,000 145,000 196,000 163,000 2015 65,000 32,000 81,000 271,000 134,000 57,000 112,000 89,000 96,000 187,000 156,000 a. Calculate the number of the accounts receivable days (or days in receivables outstanding) in Year 2016. b. If the average industry number of the accounts receivable days (or days in receivables outstanding in Year 2016 is 10, explain whether the ACE Corporation is doing better or worse than the industry. Why yes or why not? Explain your answer. What is your recommendation to the company's management? c. Calculate the number of the inventory days for days in inventory outstanding) in Year 2016. d. If the average industry number of the inventory days (or days in inventory outstanding) in Year 2016 is 50, explain whether the ACE Corporation is doing better or worse than the industry. Why yes or why not? Explain your answer. What is your recommendation to the company's management? e. Calculate the number of the accounts payable days for days in payables outstanding) in Year 2016 f. If the average industry number of the accounts payable days for days in payables outstandine) in Year 2016 is 150, explain whether the ACE Corporation is doing better or worse than the industry. Why yes or why not? Explain your answer. What is your recommendation to the company's management? & Determine whether the ACE Corporation needs to borrow money to finance their business in Year 2016. Support your answer with both an explanation and calculations