7. 
8. Calculate the following ratios for year 2 ONLY:
   1. Current ratio
   2. Total Asset Turnover
   3. Net Profit Margin (Return on Sales)
   4. Return on Equity
   5. Return on Assets
   6. Inventory Turnover
   7. Debt to Equity Ratio
   8. Times Interest Earned (Interest Coverage ratio)

Year 1 Year 2 The Corporation Balance Sheet As of December 31 Assets Current Assets Cash Accounts Receivable Inventory Supplies Prepaid Rent Total Current Assets 64,255 45,750 2,000 6,100 700 5,000 59,550 3,100 100 4,000 71,455 Property, Plant & Equipment Equipment Accumulated Depreciation Total Property, Plant & Equipment 5,000 (500) 5,000 (1,000) 4,000 4,500 Total Assets 64,050 75,455 Liabilities & Stockholders Equity Liabilities Accounts Payable Interest Payable Income Taxes Payable Notes Payable Total Liabilities 4,500 100 545 2,000 7,145 8,000 100 845 2,000 10,945 Stockholders Equity Common Stock Retained Earnings Total Stockholders Equity 55,000 1,905 56,905 55,000 9,510 64,510 Total Liabilities & Stockholders Equity 64,050 75,455 Calculation Year 1 Year 2 Year 1 20,000 9,000 11,000 Year 2 25,000 11,000 14,000 The Corporation Income Statement For the Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses Utilities expense Consulting expense Advertising expense Salaries expense Rent expense Depreciation expense Supplies expense Total Operating expenses 250 200 300 2,200 1,000 500 1,000 5,450 275 250 325 2,500 1,000 500 600 5,450 Operating Income Interest expense Net Income before taxes Income tax expense Net Income 5,550 100 5,450 545 4,905 8,550 100 8,450 845 7,605 545010% 845010% Year 1 Year 2 Statement of Retained Earnings For the Year Ended December 31 Beginning Retained Earnings Net Income 1,905 7,605 9,510 Less Dividends Ending Retained Earnings 4,905 4,905 (3,000) 1,905 9,510