6 DATA 7 Balance Sheet: (000) Cash 500 9 Accounts receivable 2,000 1.000 10 Inventories S3500 11 Current assets 4500 12 Net fixed assets $8,000 13 Total assets 14 $1,100 15 Accounts payable 16 Accrued expenses 600 300 17 Short-term notes payable 18 Current liabilities 2,000 19 Long-term debt 4000 20 owners' equity $8,000 21 Total liabilities and owners' equity 22 23 Income Statement: (000) 24 Sales (all credit ss.000 3300 25 Cost of goods sold S4700 26 Gross profit 27 Operating expenses (includes S500 depreciation 3.000 S1.700 28 Operating profit 367 29 Interest expense 30 Earnings before taxes S1,333 33 31 Income taxes (40%) 32 Net income SS00 33 34 SOLUTION 35 Calculate the following ratios: 36 Current ratio 37 Debt ratio 38 Times interest earned 39 Average collection period 40 Inventory turnover 41 Fixed asset turnover 42 Total assets turnover 43 Gross profit margin 44 Operating profit margin 45 operating return on assets 46 Return on equit 48 49