A firm has been experiencing low profitability in recent years. Perform an analysis of the firm's financial position using the DuPont equation. The firm has no lease payments but has a $2 million sinking fund payment on its debt. The most recent industry average ratios and the firm's financial statements are as follows: Industry Average Ratios Current ratio 3 x Fixed assets turnover 9 x Debt-to-capital ratio 16% Total assets turnover 4 x Times interest earned 7 x Profit margin 2.25% EBITDA coverage 8 Return on total assets 9.00% Inventory turnover 10 x Return on common equity 16.30% Days sales outstanding 17 days Return on invested 15.90% capital aCalculation is based on a 365-day year. Balance Sheet as of December 31, 2021 (millions of dollars) Cash and equivalents $ 63 Accounts payable $ 38 Accounts receivables 50 Other current liabilities 6 Inventories 117 Notes payable 25 Total current assets $230 Total current liabilities $ 69 Long-term debt 19 Total liabilities $ 88 Gross fixed assets 154 Common stock 76 Less depreciation 69 Retained earnings 151 Net fixed assets $ 85 Total stockholders' equity $227 Total assets $315 Total liabilities and equity $315 Income Statement for Year Ended December 31, 2021 (millions of dollars) Net sales Cost of goods sold Gross profit Selling expenses EBITDA Depreciation expense Earnings before interest and taxes (EBIT) Interest expense Earnings before taxes (EBT) Taxes (25%) Net income $ 715.00 610.00 $ 105.00 58.50 $ 46.50 10.00 $ 36.50 3.50 $ 33.00 8.25 $ 24.75 a. Calculate the following ratios. Do not round intermediate calculations. Round your answers to two decimal places. Firm Current ratio 3.33 Debt to total capital % Times interest earned Industry Average 3 x 16% 7x 10.43 8 x EBITDA coverage Inventory turnover 10 x 5.21 Days sales outstanding 17 days 25.52 days Fixed assets turnover 9 x 8.41 Total assets turnover 4 x 2.27 Profit margin 2.25% 3.46 % Return on total assets 9.00% 7.86 % Return on common equity 16.30% 10.90 % Return on invested capital 15.90% % b. Construct a DuPont equation, and the industry. Do not round intermediate calculations. Round your answers to two decimal places. Industry 2.25% Firm Profit margin 3.46 % Total assets turnover 4x 2.27 Equity multiplier 1.39