Comparative financial statements for Sheridan and Grouper Ltd. are shown below. SHERIDAN AND GROUPER LTD. Income Statement Year Ended December 31 2021 2020 Net sales $890,000 $850,000 Cost of goods sold 615,000 570,000 Gross profit 275,000 280,000 Operating expenses 154,000 150,000 Profit from operations 121,000 130,000 Other revenues and expenses Interest expense 30,000 20,000 Profit before income tax 91,000 110,000 Income tax expense 27,000 25,000 Profit $64,000 $85,000 SHERIDAN AND GROUPER LTD. Balance Sheet December 31 Assets 2021 2020 2019 Cash $93,000 $86,000 $10,000 Accounts receivable 115,000 110,000 96,000 Inventories 140,000 135,000 96,000 Prepaid expenses 25,000 25,000 115,000 Land, buildings, and equipment 390,000 305,000 300,000 Total assets $763,000 $661,000 $617,000 Liabilities and Shareholders' Equity Liabilities Notes payable $110,000 $100,000 $100,000 Accounts payable 45,000 42,000 60,000 Accrued liabilities 32,000 45,000 30,000 Bonds payable, due 2024 190,000 150,000 174,000 Total liabilities Shareholders' equity 377,000 337,000 364,000 Common shares (20,000 issued) 200,000 200,000 200,000 Retained earnings 186,000 124,000 53,000 Total shareholders' equity 386,000 324,000 253,000 Total liabilities and shareholders' equity $763,000 $661,000 $617,000 Additional information: Seventy-five percent of the sales were on account. The allowance for doubtful accounts was $3,000 in 2021, $4,500 in 2020, and $2,500 in 2019. In 2021 and 2020, dividends of $3,000 and $8,000, respectively, were paid to the common shareholders. Cash provided by operating activities was $103,500 in 2021 and $120,000 in 2020. Cash used by investing activities was $115,500 in 2021 and $32,000 in 2020. 1. 2. 3. 4. 5. (a) Calculate all possible liquidity, solvency, and profitability ratios for 2021 and 2020. (Round answers for Collection period, Days sales in inventory, Operating cycle and Free cash flow to 0 decimal places, e.g. 125. Round answer for Earnings per share to 2 decimal places, e.g. 12.50. Round all other answers to 1 decimal place, eg. 12.5 or 12.5%. Enter negative amount using either a negative sign preceding the number eg. -45 or parentheses eg. (45).) 2021 2020 Liquidity Ratios 1. Current ratio :1 :1 Acid-test ratio :1 :1 3. Receivables turnover times times Collection period days days 5. Inventory turnover times times 6. Days sales in inventory days days 7. Operating cycle days days Solvency Ratios 8. Debt to total assets 9. Interest coverage times times 10. Free cash flow Profitability Ratios 11. Gross profit margin 12. Profit margin % 13. Asset turnover times times 14. Return on assets 15. Return on equity 16. Earnings per share $ 17. Payout ratio %24 %24 %24 2. 4.