Based on your review of work paper 5-1, assess the client's ability to continue as a going concern (to stay in business) by responding to the following questions.

A B D E F 2. Assessment of Financial Position Based on your review of work paper 5-1, assess the client's ability to continue as a going concern (to stay in business) by responding to the following questions. A. Identify ratios and trends, if any, that cause concern about the client's ability to continue as a going concern Enter your response here (This cell will expand automatically to fit your response - use ALT+ENTER to begin a new line) B. Identify ratios and trends, if any, that indicate a high likelihood that the client will continue successfully as a going concern Enter your response here (This cell will expand automatically to fit your response - use ALT+ENTER to begin a new line) C. Assess the client's financial condition as one of the following (select one from the drop down list in cell B35) Click on the yellow cell above and the drop down list button will appear in the far right side of the cell. Your selection will then appear in this box. You can change your selection using the drop down list. D. Briefly explain the reasoning behind your assessment. Enter your response here (This cell will expand automatically to fit your response - use ALT+ENTER to begin a new line) The McGraw-Hill Companies, Inc., 2019 = dste B I U & II IND > > 60.00 .00 0 Cell Styles I Format Clipboard IN Font 27 Alignment Number Styles Cells Ed S43 fx B D E F G . J K 1 L M N N o Q R S 1.64 1.43 1.92 1.80 1.94 2.17 0.23 2.10 0.07 0.39 0.44 0.62 0.53 0.65 0.73 0.08 0.80 -0.07 0.69 0.42 0.81 0.34 0.40 0.40 0.00 N/A N/A 71.18 77.25 74.34 73.82 75.41 118.00 42.60 N/A N/A 5.13 4.73 4.91 4.94 4.84 3.09 -1.74 14.10 -11.01 3.43 4.27 4.48 447 4.99 3.87 - 1.12 6.20 -2.33 106.41 85.51 81.40 81.72 69.22 94.99 25.78 58.70 36.29 8 SHORT-TERM LIQUIDITY RATIOS: 9 Current Ratio 10 current assets/ current liabilities 11 Quick Ratio 12 liquid assets/ current liabilities 13 Operating Cash Flow Ratio 14 cash flow from operations / current liabilities 15 16 ACTIVITY RATIOS: 17 Receivables Turnover 18 net sales / net ending receivables 19 Days Outstanding in Accounts Receivable 20 365 days / receivables turnover 21 Inventory Turnover 22 cost of sales / inventory 23 Days of Inventory on Hand 24 365 / (cost of sales/inventory) 25 26 PROFITABILITY / PERFORMANCE RATIOS: 27 Gross Profit Percentage 28 gross proft / net sales 29 Profit Margin 30 net income / net sales 31 Return on Assets 32 net income / total assets 33 Return on Equity 34 net income / total owners' equity 35 36 COVERAGE RATIOS: 37 Debt to Equity 38 total liabilities / shareholders' investment 39 Times Interest Earned 40 (net income +interest expense) / interest expense 44.95% 44 91% 44.89% 42.51% 42.49% 43.90% 1.41% 38.80% 5.10% 2.34% 3.61% 3.64% 2.37% 3.02% 4.26% 1.24% 3.30% 0.96% 14.80% 6.84% 10.53% 6.83% 4.69% 11.17% 6.48% 7.40% 3.77% 26.43% 12.86% 16.22% % 11.03% 5.92% 16.70% 10.78% 17.50% -0.80% 0.79 0.88 0.58 0.61 0.51 0.50 -0.01 0.84 -0.34 53.88 26.31 26.41 23.92 10.19 50.57 40.38 N/A N/A Work Paper 5-1 Work Paper 5-2 Work Paper 5-3 Common Size Balance Sheet Common Size Income Statem ... II. A B D E F 2. Assessment of Financial Position Based on your review of work paper 5-1, assess the client's ability to continue as a going concern (to stay in business) by responding to the following questions. A. Identify ratios and trends, if any, that cause concern about the client's ability to continue as a going concern Enter your response here (This cell will expand automatically to fit your response - use ALT+ENTER to begin a new line) B. Identify ratios and trends, if any, that indicate a high likelihood that the client will continue successfully as a going concern Enter your response here (This cell will expand automatically to fit your response - use ALT+ENTER to begin a new line) C. Assess the client's financial condition as one of the following (select one from the drop down list in cell B35) Click on the yellow cell above and the drop down list button will appear in the far right side of the cell. Your selection will then appear in this box. You can change your selection using the drop down list. D. Briefly explain the reasoning behind your assessment. Enter your response here (This cell will expand automatically to fit your response - use ALT+ENTER to begin a new line) The McGraw-Hill Companies, Inc., 2019 = dste B I U & II IND > > 60.00 .00 0 Cell Styles I Format Clipboard IN Font 27 Alignment Number Styles Cells Ed S43 fx B D E F G . J K 1 L M N N o Q R S 1.64 1.43 1.92 1.80 1.94 2.17 0.23 2.10 0.07 0.39 0.44 0.62 0.53 0.65 0.73 0.08 0.80 -0.07 0.69 0.42 0.81 0.34 0.40 0.40 0.00 N/A N/A 71.18 77.25 74.34 73.82 75.41 118.00 42.60 N/A N/A 5.13 4.73 4.91 4.94 4.84 3.09 -1.74 14.10 -11.01 3.43 4.27 4.48 447 4.99 3.87 - 1.12 6.20 -2.33 106.41 85.51 81.40 81.72 69.22 94.99 25.78 58.70 36.29 8 SHORT-TERM LIQUIDITY RATIOS: 9 Current Ratio 10 current assets/ current liabilities 11 Quick Ratio 12 liquid assets/ current liabilities 13 Operating Cash Flow Ratio 14 cash flow from operations / current liabilities 15 16 ACTIVITY RATIOS: 17 Receivables Turnover 18 net sales / net ending receivables 19 Days Outstanding in Accounts Receivable 20 365 days / receivables turnover 21 Inventory Turnover 22 cost of sales / inventory 23 Days of Inventory on Hand 24 365 / (cost of sales/inventory) 25 26 PROFITABILITY / PERFORMANCE RATIOS: 27 Gross Profit Percentage 28 gross proft / net sales 29 Profit Margin 30 net income / net sales 31 Return on Assets 32 net income / total assets 33 Return on Equity 34 net income / total owners' equity 35 36 COVERAGE RATIOS: 37 Debt to Equity 38 total liabilities / shareholders' investment 39 Times Interest Earned 40 (net income +interest expense) / interest expense 44.95% 44 91% 44.89% 42.51% 42.49% 43.90% 1.41% 38.80% 5.10% 2.34% 3.61% 3.64% 2.37% 3.02% 4.26% 1.24% 3.30% 0.96% 14.80% 6.84% 10.53% 6.83% 4.69% 11.17% 6.48% 7.40% 3.77% 26.43% 12.86% 16.22% % 11.03% 5.92% 16.70% 10.78% 17.50% -0.80% 0.79 0.88 0.58 0.61 0.51 0.50 -0.01 0.84 -0.34 53.88 26.31 26.41 23.92 10.19 50.57 40.38 N/A N/A Work Paper 5-1 Work Paper 5-2 Work Paper 5-3 Common Size Balance Sheet Common Size Income Statem