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After graduating from college in May 2018, Ryan Crews started his career in finance at the W&T Corporation, a small to medium-sized warehouse distributor in Nashville, Tennessee. The company was founded by David Winston and Colin Tabor in 2005, after they have worked together in management at Walmart. Although Crews had an offer from Sam's Club, he became excited about the opportunity with W&T. For W&T, 2017 turned out to be a good financial year. But in 2018, the company experienced a 5.1 percent sales reduction, where sales declined from $5.7 million to $5.4 million. The downturn then led to other financial problems, including a 50 percent reduction in the company's stock price. The share price went from $34 per share at the end of 2017 to $17 per share at the end of 2018! David Winston and Colin Tabor want to understand what may have happened. Financial information for W&T for both years is shown in the popup window, where all the numbers, except for per-share data, are shown in thousands W and T Corporation Income Statement ($ thousands) for the Years Ended 12/31/2017 and 12/31/2018 2017 2018 Sales $ $ 5,700 (3,500) 5,400 (3,200) $ 2,200 $ 2,200 Cost of goods sold Gross profits Operating expenses: Selling, general, and administrative expenses Depreciation expenses Total operating expenses Operating profits (810) (340) (760) (490) $ (1.150) $ (1.250) $ $ 1,050 (180) 950 (275) Interest expense Earnings before taxes (taxble income) $ 870 (183) 675 (142) Income taxes Net income $ 687 $ 533 $ Net income 687 533 Additional information: 150 150 Number of common shares outstanding Dividends paid to stockholders Market price per share $133 $133 $34 $17 W and T Corporation Balance Sheet ($ thousands) for 12/31/2017 and 12/31/2018 2017 2018 ASSETS Cash $ 300 $ 505 Accounts receivable 600 915 Inventories 500 780 150 Other current assets 115 Total current assets $ 1,515 $ 2,350 Gross fixed assets $ 4.750 $ 5.050 Total current assets $ 2,350 Gross fixed assets $ 1,515 4,750 (1,700) $ 5,050 (2,300) Accumulated depreciation Net fixed assets $ 3,050 $ 2,750 $ $ 4,565 $ 5,100 Total assets LIABILITIES (DEBT) AND EQUITY Accounts payable Short-term notes payable Total current liabilities $ 300 $ 740 150 200 $ 450 1,250 940 1,325 Long-term debt Total liabilities $ 1,700 $ 2,265 Common equity: Common stock $ $ $ 1,200 1,665 1,200 1,635 Retained earnings Total common equity $ 2,865 $ 2,835 $ $ Total liabilities and equity 4,565 $ 5,100 2017 2018 Current ratio Acid-test ratio Days in receivables Days in inventories Operating return on assets Operating profit margin Total asset turnover Fixed asset turnover Debt ratio Times interest earned Return on equity