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) Cost of goods sold Gross profit Operating expenses Other expense interest) Income tax expense Net income $2,567,100 1,873,200 $693,900 320,000 24,200 175,000 $2,166,800 1,615,800 $ 551,000 225,400 24,200 108,900 $192,500 $174,700 Cowan Kitchen Counters, Inc. Comparative Balance Sheet December 31, 20-2 and 20-1 20-2 20-1 Cash Government notes Accounts receivable (net) Merchandise inventory $255,300 249,500 904,200 991,200 $246,600 249,500 799,500 915,600 Cowan Kitchen Counters, Inc. Comparative Balance Sheet December 31, 20-2 and 20-1 20-2 20-1 Cash $255,300 $246,600 249,500 799,500 915,600 Government notes Accounts receivable (net) Merchandise inventory Supplies and prepayments Land Building (net) Office equipment (net) 249,500 904,200 991,200 149,900 108,700 48,600 108,700 331,700 387,300 14,100 18,000 $3,008,500 Total assets $2,769,900 Current liabilities (accounts payable) Bonds payable Total liabilities $698,600 220,000 $918,600 $533,700 240,000 $773,700 $1,800,000 Common stock (10 par, 180,000 shares) Retained earnings Total stockholders' equity $1,800,000 196,200 289,900 $2,089,900 $3,008,500 $1,996,200 $2,769,900 Total liabilities and stockholders' equity LEI. -------- HCCUNSTECIVO Merchandise inventory Supplies and prepayments Land Building (net) Office equipment (net) Total assets 904,200 991,200 149,900 108,700 331,700 18,000 $3,008,500 915,600 48,600 108,700 387,300 14,100 $2,769,900 Current liabilities (accounts payable) Bonds payable Total liabilities $698,600 220,000 $918,600 $533,700 240,000 $773,700 Common stock (10 par, 180,000 shares) $1,800,000 $1,800,000 Retained earnings 289,900 196,200 Total stockholders' equity $2,089,900 $1,996,200 Total liabilities and stockholders' equity $3,008,500 $2,769,900 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 days b. Merchandise inventory turnover days to 1 C. Asset turnover