CAN YOU PLEASE SHOW THE STEPS! THANKS

Welcome to your new job as an Analyst with Lexi Holdings, an investment firm with a wide range of investment holdings! Your first assignment is to assess RetroSpin. Your new boss, Wally Oliver, hands you a multi-year Income Statement (Appendix Al) and multi-year Balance Sheet (Appendix A2) for RetroSpin Records. RetroSpin is record store, wholly owned by Lexi Holdings, catering to music enthusiasts who prefer vinal records over digital music or other music formats. RetroSpin brought on a new CEO in Jan 1, 2015. Your boss asks you to assess whether or not RetroSpin is doing well under the new CEO. Your job is to calculate and interpret important financial ratios and to make comments on how things have changed since the new CEO came on board. You are also required to compare RetroSpin to others in the industry. Appendix A3 contains industry average information. Please use the information in Appendix Al to A3 to calculate the following ratios: 1. Current ratio 2. Account Receivable ratio (or days receivable) 3. Accounts Payable ratio (or days payable) 4. Debt ratio 5. Gross Profit margin 6. Operating Profit margin 7. Net Profit margin 8. Return on Assets 9. Return on Equity Calculate each of the ratios above for 2014, 2015 and 2016. Interpret your calculations: what does this information mean? How is the company doing under the new CEO? (You should compare things before and after the CEO came on board). How is the company doing relative to the industry? Appendix A1: RetroSpin Records Comparative Income Statement ($M) For the Years Ended Dec 31, 2013 to 2016 2013 2014 2015 2016 Sales $ 75.00 $ 78.75 $ 86.63 $ 95.29 Cost of Goods Sold $ 41.94 $ 44.03 $ 46.24 $48.55 Gross Profit $ 33.06 $ 34.72 $ 40.39 $ 46.74 Selling and Administration $ 18.75 $ 17.72 $ 17.33 $ 19.06 Depreciation $ 1.51 $ 2.71 $ 4.31 $ 4.18 Operating Profit $ 12.81 $ 14.29 $ 18.76 $ 23.50 Interest $ 1.88 $ 2.51 $ 7.10 $ 4.93 Earnings Before Taxes $ 10.92 $ 11.78 $ 11.65 $ 18.57 Taxes $ 2.73 $ 2.95$ 2.91 $ 4.64 Net Income $ 8.19 $ 8.84 $ 8.74 $ 13.93 Appendix A2: RetroSpin Records Comparative Balance Sheet ($M) For the Years Ended Dec 31, 2013 to 2016 2013 2014 2015 2016 Cash $ 2.05 $ 2.21 $ 2.19 $ 3.48 A/R $ 1.02 $ 1.10 $ 1.09 $ 1.74 Inventory $ 15.00 $ 15.75 $ 17.33 $ 19.06 Total Current Assets $ 18.07 $ 19.06 $ 20.60 $ 24.28 Land, Plant and Equipment $ 10.86 $ 32.46 $ 36.84 $ 35.60 Other Assets $ 0.49 $ 1.08 $ 1.68 $ 1.76 Total Assets $ 29.43 $ 52.60 $ 59.11 $ 61.65 A/P $ 10.75 25.00 $ 22.43 $ 21.99 Current Portion of LT Debt $ 0.58 $ 0.58 $ 0.58 $ 0.58 Total Current Liabilities $ 11.33 $ 25.58 $ 23.01 $ 22.57 Long-term Debt $ 10.56 $ 10.56 $ 10.56 $ 10.56 Total Liabilities $ 21.89 $ 36.14 $ 33.57 $ 33.13 Shareholders' Equity $ 7.54 $ 16.46 $ 25.54 $ 28.51 Total Liabilities and Equities $ 29.43 $ 52.60 $ 59.11 $ 61.65 RetroSpin Records Appendix A3: Industry Averages 2016 Current Ratio 1.35 0.25 40.12 34.5 Cash Ratio Inventory Turnover (days) A/R Turnover (days) A/P Turnover (days) Cash Conversion Cycle Fixed Assets Turnover Total Assets Turnover 50.1 15.35 3.5 1.75 Debt Ratio 0.5 10.5 28.00% 12.00% Times Interest Earned Gross Profit Margin Operating Profit Margin Net Profit Margin Return on Assets Return on Equity 7.50% 15.50% 37.50%