Comprehensive Ratio Analysis Data for Lozano Chip Company and its industry averages follow. Lozano Chip Company: Balance Sheet as of December 31, 2018 (Thousands of Dollars) Cash $ 225,000 Accounts payable $ 601,866 Receivables 1,575,000 Notes payable 326,634 Inventories 1,145,000 Other current liabilities 530,000 Total current assets $2,945,000 Total current liabilities $1,458,500 Net fixed assets 1,350,000 Long-term debt 1,068,750 Common equity 1,767,750 Total assets $4,295,000 Total liabilities and equity $4,295,000 Lozano Chip Company: Income Statement for Year Ended December 31, 2018 (Thousands of Dollars) Sales Cost of goods sold Selling, general, and administrative expenses Earnings before interest and taxes (EBIT) Interest expense Earnings before taxes (EBT) Federal and state income taxes (40%) Net income $7,500,000 6,375,000 810,000 $ 315,000 111,631 $ 203,369 81,348 $ 122,021 a. Calculate the indicated ratios for Lozano. Do not round intermediate calculations. Round your answers to two decimal places. Ratio Lozano Industry Average Current assets/Current liabilities 2.02 2.0 Days sales outstanding* 76.65 days 35.0 days COGS/Inventory 5.57 6.7 Sales/Fixed assets 5.56 12.1 Sales/Total assets 1.75 1.63 Net income/Sales 3.0 1.2% 3.6% Net income/Total assets 2.84 Net income/Common equity 6.90 9.0% Total debt/Total assets 32.49 Total liabilities/Total assets 58.84 *Calculation is based on a 365-day year. 30.0% 60.0% b. Use the extended DuPont equation to calculate ROE for both Lozano and the industry. Do not round intermediate calculations. Round your answers to two decimal places. For the firm, ROE is 6.93 %. For the industry, ROE is 9 %