a. Compute the following 13 ratios. (Use a 360-day year. Do not round intermediate calculations. Input your profit margin, return on assets, return on equity, and debt to total assets answers as a percent rounded to 2 decimal places. Round all other answers to 2 decimal places.)

b. Provide what each ratio represents to the company.

Smith Corporation:

Cash

$35,000

Marketable securities

$7,500

Accounts receivable

$70,000

Inventory

$75,000

Total current assets

$187,500

Gross plant and equipment

$500,000

Accumulated depreciation

$250,000

Net plant and equipment

$250,000

Total assets

$1,375,000

Accounts payable

$75,000

Bonds payable (long-term)

$210,000

Total liabilities

$285,000

Common stock

$75,000

Capital paid in excess of par

$30,000

Retained earnings

$47,500

Total stockholders' equity

$722,500

Total liabilities and stockholders' equity

$2,097,500

Credit sales

$1,000,000

Cost of goods sold

$600,000

Gross profit

$1,600,000

Selling and administrative expense

$224,000

Depreciation

50,000

Operating profit (EBIT)

$1,326,000

Interest expense

$21,000

Earnings before taxes (EBT)

$1,305,000

Taxes

$52,500

Earnings after taxes (EAT)

$1,252,500

Lease payments included in S&A exp

$7,000

1

Profit margin

2

Return on assets

3

Return on equity

4

Receivables turnover

5

Average collection period

6

Inventory turnover

7

Fixed asset turnover

8

Total asset turnover

9

Current ratio

10

Quick ratio

11

Debt to total assets

12

Times interest earned

13

Fixed charge coverage