CRANE COMPANY Balance Sheets December 31 Assets 2022 Cash $ 71,000 Debt investments (short-term) 50,000 Accounts receivable 107,000 Inventory 234,000 Prepaid expenses 29,000 Land 135,000 Building and equipment (net) 261,000 Total assets $887,000 Liabilities and Stockholders' Equity Notes payable $169,000 Accounts payable 66,000 Accrued liabilities 42,000 Bonds payable, due 2025 250,000 Common stock, $10 par 203,000 Retained earnings 157,000 Total liabilities and stockholders' equity $887,000 2021 $ 69,000 41,000 92,000 162,000 23,000 135,000 187,000 $709,000 $106,000 54,000 42,000 171,000 203,000 133,000 $709,000 CRANE COMPANY Income Statements For the Years Ended December 31 2022 2021 Sales revenue $902,000 $792,000 Cost of goods sold 647,000 576,000 Gross profit 255,000 216,000 Operating expenses 195,000 160,000 Net income $ 60,000 $ 56,000 Additional information: 1. 2. 3. Inventory at the beginning of 2021 was $116,000. Accounts receivable (net) at the beginning of 2021 were $88,000. Total assets at the beginning of 2021 were $642,000. No common stock transactions occurred during 2021 or 2022. All sales were on account. 4. 5. (b) Given below are three independent situations and a ratio that may be affected. For each situation, compute the affected ratio (1) as of December 31, 2022, and (2) as of December 31, 2023, after giving effect to the situation. (Round Debt to assets ratio to 0 decimal places, e.g. 15 and round all other answers to 1 decimal place, e.g. 15.5. Round % change to O decimal places, for e.g. 1% and if % change is a decrease show the numbers as negative, e.g. -1% or (1%).) 1. Situation 20,000 shares of common stock were sold at par on July 1, 2023. Net income for 2023 was $55,000. All of the notes payable were paid in 2023. All other liabilities remained at their December 31, 2022 levels. Total assets on December 31, 2023, were $868,000. The market price of common stock was $9 and $12 on December 31, 2022 and 2023, respectively. Ratio Return on common stockholders' equity Debt to assets ratio 2. 3. Price-earnings ratio 2022 2023 % Change % % % Return on common stockholders' equity Debt to assets ratio Price earnings ratio % % % times times %