A comparative income statement is given below for McKenzie Sales, Limited, of Toronto: McKenzie Sales, Limited Comparative Income Statement Sales Cost of goods sold Gross margin This Year $ 7,390,000 4,660,000 2,730,000 Last Year $ 5,616,400 3,512,000 2,104,400 Selling and administrative expenses: 1,395,000 1,074,500 Administrative expenses 704,000 611,000 Selling expenses Total expenses Net operating income Interest expense Net income before taxes 2,099,000 1,685,500 418,900 92,000 631,000 105,000 $ 526,000 $ 326,900 Members of the company's board of directors are surprised to see that net income increased by only $199.100 when sales increased by $1,773,600. Required: 1. Express each year's income statement in common-size percentages. (Round your percentage answers to 1 decimal place (I.e.. 0.1234 should be entered as 12.3).) This Year Last Year Sales Cost of goods sold % 96 % 96 Gross margin 0.0 % 0.0 % Selling and administrative expenses: Selling expenses Administrative expenses % 96 % 96 Total selling and administrative expenses 0.0 % 0.0 % Net operating income 0.0 % 0.0 % Interest expense % 96 Net income before taxes 0.0 % 0.0 % Required information [The following information applies to the questions displayed below] You have just been hired as a financial analyst for Lydiex Company manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company's financial statements, including comparing Lydex's performance to its major competitors. The company's financial statements for the last two years are as follows: Curative Balance Cast: Cash Accounts receivable, et Deventory total current assets Fast and t Les and Stockholders alty Nto payable, Total abilities Can stock, par valu total stockholders squity otalities and stable quit Lyds Cappy 11, Sales (all on account) Cost of goods wold Grosi Net operating inca set incone before taxes Income taxes (3) Not incone Common divided Net income retained giding retained nding retained in To begin your assignment you gather the following financial cats and ratios that are typical of companies in Lyclex Company's industry Curat Acid test rati Average collection period Ditt to pity ratie 2.3 All days 0.7 Tines interest came t 5.9 Felonings ratio Required: 1. You decide first to assess the company's performance in terms of dest management and profitability Compute the following for bath this year and last year (Round your "Percentage" answers to 1 decimal place and other answers to 2 decimal places.) a. The times Interest earned ratio a. The debt-to-equity retto The gross margin percentage 4. The return on total assets. Total assets at the beginning of last year were $13.000.000) e. The return on equity (Stockholders' equity at the beginning of at year to $8301600. There has been no change in common stock over the last years. Elathe company's financial leverage postive or negative a. The times interest camera The dect-to-eauty o The gross margin percentage d The retum on t The ratum an aut t is the company's francia verage positive or negativ