answer with explaination please

P3-24 Integrative-Complete ratio analysis Given the following financial statements (following and on page 109), historical ratios, and industry averages, calculate Sterling Company's financial ratios for the most recent year. (Assume a 365-day year.) "The firm has an 8.your financial lease requiring annual begiming of-ycar paymente of 5S0,000. Five vears of the lease hane vat to nan. The anmuat principal payment on the lone term dabe is 5100,000 . \begin{tabular}{|c|c|c|c|} \hline \multicolumn{4}{|c|}{ Historical and Industry Average Ratios for Sterling Company } \\ \hline Ratio & Actual 2010 & Actual 2011 & \begin{tabular}{l} Industry average, \\ 2012 \end{tabular} \\ \hline Current ratio & 1.40 & 1.55 & 1.85 \\ \hline Quick ratio & 1.00 & 0.92 & 1.05 \\ \hline Inventory turnover & 9.52 & 9.21 & 8.60 \\ \hline Average collection period & 45.6 days & 36.9 days & 35.5 days \\ \hline Average payment period & 59.3 days & 61.6 days & 46.4 days \\ \hline Total asset turnover & 0.74 & 0.80 & 0.74 \\ \hline Debt ratio & 0.20 & 0.20 & 0.30 \\ \hline Times interest earned ratio & 8.2 & 7,3 & 8.0 \\ \hline Fixed-payment coverage ratio & 4.5 & 4.2 & 4.2 \\ \hline Gross profit margin & 0.30 & 0.27 & 0.25 \\ \hline Operating profit margin & 0.12 & 0.12 & 0.10 \\ \hline Net profit margin & 0.062 & 0.062 & 0.053 \\ \hline Return on total assets (ROA) & 0.045 & 0.050 & 0.040 \\ \hline Return on common equity (ROE) & 0.061 & 0.067 & 0.066 \\ \hline Earnings per share (E.PS) & $1.75 & $2.20 & $1.50 \\ \hline Pricelearnings (P/E) ratio & 12.0 & 10.5 & 11.2 \\ \hline Market/book (M/B) ratio & 1.20 & 1.05 & 1.10 \\ \hline \end{tabular}