BUSI 320 Comprehensive Problem 1 Spring 2020 Use the following information to answer the questions below: note: all sales are credit sales Income Stmt info: 2018 Sales $ 1,000,000 less Cost of Goods Sold: 400.000 Gross Profit 600,000 Operating Expenses 350,000 Earnings before Interest & Taxes 250,000 Interest exp - 20.000 earnings before Taxes 230,000 Taxes 69.000 Net Income $ 161,000 2019 $ 1,050,000 432.000 618,000 365,750 252,250 20.400 231,850 69.555 $ 162,295 Balance Sheet info: Cash Accounts Receivable Inventory Total Current Assets Fixed Assets (Net) Total Assets 12/31/2018 12/31/2019 25,000 $ 30,000 50,000 $ 54,000 125,000 $ 130,000 200,000 $ 214,000 300.000 $ 318.000 $ 500,000 $ 532,000 Current Liabilities Long Term Liabilities Total Liabilities Stockholder's Equity Total Liab & Equity: $ $ $ $ $ 110,000 $ 180.000 $ 290,000 $ 210,000 $ 500,000 $ 119,900 175.000 294,900 237,100 532,000 Compute each of the following ratios for 2018 and 2019 and indicate whether each ratio was getting "better" or "worse" from 2018 to 2019 and was "good" or "bad" compared to the Industry Avg in 2019 (round all numbers to 2 digits past the decimal place) Getting Better or Getting 2019 Worse? "Good" or "Bad" compared to Industry 2018 Avg 2019 Industry Avg 0.11 1.90 0.66 28 Profit Margin Current Ratio Quick Ratio Return on Assets Debt to Assets Receivables turnover Avg. collection periodo Inventory Turnover** Return on Equity Times Interest Earned 18.00 15.50 9.25 0.55 13.20 * Assume a 360 day year **Inventory Turnover can be computed 2 different ways. Use the formula listed in the text (the one the text indicates many credit reporting agencies generally use)