9 of 9 Financial information for Edward Lewis Company is presented below. Edward Lewis Commpany Statements of Financial Position December 31 8.89/10 Assets 2020 2019 Land 150,800 150,800 Building and equipment (net) 194,880 203,000 Prepaid expenses 33,640 26,680 Inventory 145,000 156,600 Accounts receivables (net) 113.680 92,800 Short-term investments 60,320 46,400 Cash 81,200 75,400 Total assets 779,520 751,680 Equity and Liabilities Share capital-ordinary, 10 par 232,000 232,000 Retained earnings 150,800 134,560 Bonds payable, due 2023 174,000 174,000 Notes payable 116,000 116,000 Accounts payable 55,680 48,720 Accrued liabilities 51,040 46,400 Question 9 of 9 < 8.89/1- Land 150,800 150,800 Building and equipment (net) 194,880 203,000 Prepaid expenses 33,640 26,680 Inventory 145,000 156,600 Accounts receivables (net) 113,680 92,800 Short-term investments 60,320 46,400 Cash 81,200 75,400 Total assets 779,520 751,680 Equity and Liabilities Share capital-ordinary, 10 par 232.000 232,000 Retained earnings 150,800 134.560 Bonds payable, due 2023 174,000 174,000 Notes payable 116,000 116,000 Accounts payable 55,680 48,720 Accrued liabilities 51,040 46,400 Total equity and liabilities 779,520 751,680 Total equity and liabilities 779,520 751,680 Edward Lewis Company Income Statement For the Years Ended December 31 2020 2019 Net sales 995,280 925,680 Cost of goods sold 708,760 667,000 Gross profit 286,520 258,680 Operating expenses 237,220 209.960 Net income 49,300 48,720 Additional information: 1. Inventory at the beginning of 2019 was 136,880. 2. Total assets at the beginning of 2019 were 733,120. 3. No ordinary shares transactions occurred during 2019 or 2020. 4. All sales were on account. 5. Accounts receivable (net) at the beginning of 2019 were 102,080. 6. Notes payable are classified as a current liability. 8.89/10 Question 9 of 9 8.89/10 !!! Your answer is correct. Calculate the liquidity and profitability ratios of Edward Lewis Company from 2019 to 2020. Indicate, by using ratios, the change in liquidity and profitability. (Round answers to 2 decimal places, eg. 6.80 or 6.80%) LIQUIDITY Current 2020 1.95 :1 2019 Char 188 :1 Increas Acid-test 1.15 :1 102 1 Increas Accounts receivables turnover 9.64 times 9.50 times Increas Inventory turnover 4.70 times 4.55 times increas PROFITABILITY 4.95 % 5.26 % Decrea Profit margin Asset turnover Return on assets 1.30 times 1.25 times Increas 6.44 % Earnings per share 2.13 6.56 % Decrea 2.10 Increas Question 9 of 9 8.89/10 E Your answer is partially correct. Given below are three independent situations and a ratio that may be affected. For each situation, compute the affected ratio (1) as of December 31, 2020, and (2) as of December 31, 2021, after giving effect to the situation. Net income for 2021 was 58.000. Total assets on December 31, 2021, were 812,000. (Round ratios to 1 decimal place, eg. 6.8 or 6.8%) Situation Ratio (1) 20,880 ordinary shares were sold at par on July 1, 2021. There were no dividends in 2021. Return on ordinary shareholders' equity (2) All of the notes payable were paid in 2021. The only change in liabilities was that the notes payable were paid. Debt to total assets (3) Market price of ordinary shares was 10 on December 31, 2020, and 13.5 on December 31, 2021. Price-earnings ratio Return on ordinary shareholders' equity Debt to total assets Price-earnings ratio eTextbook and Media C 2020 2021 13.2 % 112 % 50.9 % 346 % 4.7 times times