A) The balance sheet and income statement for the I.P. Robard Mfg Company are as follows: (12 marks) Balance Sheet (5000) Cash Accounts receivable Inventories Current assets Net fixed 25:ets Total assets Accounts payable Accrued expenses Short-term notes payable Current liabilities Long-term debt Oumers' equity Total liabilities and oners' equity $ 500 2.000 1,000 3,500 4.300 $8,000 $ $1,100 600 300 $2.000 2,000 4,000 $8,000 $8,000 (3.300) 4,700 Income Statement (5000) Net sales (all credit) Cost of goods sold Gross profit Operating expenses (includes $500 depreciation) Operating income Interest expense Eamings before taxes Income taxes (40%) Net income (3.000) 1,700 (367) $1,333 (533) $ 800 A) Calculate and interpret the financial ratios for 2019 corresponding to the industry norms provided as follows: INDUSTRY NORMIS Current ratio 1.51 Inventory tumover 1x Total asset turnover Operating profit margin Operating income return on investment 18% 18% Debt ratio 60% Average collection period 100 days Fixed asset tumover 1.3:1 Return on equity 15% B) The company is applying for Bank Loan Write a report to Gulf Bark PLC whether you recommend the bank for sanction of Lom. (4 marks 250 words) C) Would you recommend investment in this company? Similar companies pay 12% retum. Calculate any other ratio you think appropriate Write a report. (4 marks 250 words) 1. Firm Liquidity current ratio current assets current liabilities average collection period accounts receivable | dailycredit sales 2. Operating Profitability operating income operating income return on investment - total assets operating profit margin operating income sales sales total asset tumover total assets inventorytumover cost of goods sold inventory fixed assets tumover sales net fixed assets 3. Financing Decisions debt ratio- total debt total assets 4. Return on common equity retum on common equity net income common equity