Analysis of Activity Measures Based on the comparative income statement and balance sheet of Cowan Kitchen Counters, Inc., that follow: Cowan Kitchen Counters, Inc. Comparative Income Statement For Years Ended December 31, 20-2 and 20-1 20-2 20-1 Net Sales (all on account) $2,590,300 $2,164,600 Cost of goods sold 1,852,700 1,617,000 Gross profit $737,600 $547,600 Operating expenses 316,100 212,000 Other expense (interest) 24,200 24,200 Income tax expense 175,700 108,000 Net income $221,600 $203,400 Cash Cowan Kitchen Counters, Inc. Comparative Balance Sheet December 31, 20-2 and 20-1 Government notes Accounts receivable (net) Merchandise inventory Supplies and prepayments Land 20-2 20-1 $259,200 $241,600 249,400 249,400 906,600 797,200 979,700 915,100 147,100 46,900 106,500 106,500 Building (net) Office equipment (net) Total assets 106,500 106,500 328,500 391,500 17,600 15,100 $2,994,600 $2,763,300 Current liabilities (accounts payable) $705,800 $533,700 Bonds payable 220,000 240,000 Total liabilities $925,800 $773,700 Common stock (10 par, 180,000 shares) $1,800,000 $1,800,000 Retained earnings 268,800 189,600 Total stockholders' equity $2,068,800 Total liabilities and stockholders' equity $2,994,600 $1,989,600 $2,763,300 Compute the following activity measures for 20-2 (round all calculations to two decimal places): Use 365 days when computing the accounts receivable and merchandise Inventory turnover. a. Accounts receivable turnover 119.28 X days b. Merchandise inventory turnover 185.28 X days c. Asset turnover 0.90 to 1 Feedback