a. Use the preceding financial statements to complete the following table. Assume the industry averages given in the table are applicable for both 2014 and 2013 Zach Industries Balance Sheet December 31, 2015 Assets Cash Marketable securities Accounts receivable Inventories Total current assets Land Buildings and equipment Less: Accumulated depreciation Net fixed assets Total assets $ 500 1,000 25,000 45,500 $ 72,000 $ 26,000 90,000 38,000 $ 78,000 $150,000 Liabilities and Stockholders' Equity Accounts payable $ 22,000 Notes payable 47,000 Total current liabilities $ 69,000 Long-term debt 22,950 Common stock 31,500 Retained earnings 26,550 Total liabilities and stockholders' equity $ 150,000 "The firm's 3,000 outstanding shares of common stock closed 2015 at a price of $25 per share. 6 P3-24 Financial statement analysis The financial statements of Zach Industries for the year ended December 31, 2015, follow. Zach Industries Income Statement for the Year Ended December 31, 2015 $160,000 106,000 $ 54,000 Sales revenue Less: Cost of goods sold Gross profits Less: Operating expenses Selling expense General and administrative expenses Lease expense Depreciation expense Total operating expense Operating profits Less: Interest expense Net profits before taxes Less: Taxes Net profits after taxes $ 16,000 10,000 1,000 10,000 $ 37,000 $ 17,000 6,100 $ 10,900 4,360 $ 6,540 Actual 2015 Industry average 1.80 0.70 2.50 37.5 days 65% Ratio Current ratio Quick ratio Inventory turnover Average collection perioda Debt ratio Times interest earned ratio Gross profit margin Net profit margin Return on total assets Return on common equity Market/book ratio Actual 2014 1.84 0.78 2.59 36.5 days 67% 4.0 40% 3.6% 4.0% 8.0% 1.2 3.8 38% 3.5% 4.0% 9.5% 1.1 "Based on a 365-day year and on end-of-year figures. b. Analyze Zach Industries' financial condition as it is related to (1) liquidity, (2) activity, (3) debt, (4) profitability, and (5) market. Summarize the company's overall financial condition