Data for Lozano Chip Company and its industry averages follow

a. Calculate the indicated ratios for Lozano

b. Construct the extended DU PONT equation for both Lozano and the industry

c. Outline Lozano strengths and weakness as revealed by your analysis

Lozano Chip Company: Balance Sheet as of December 31, 2019 (Thousands of Dollars)

cash $225,000 Accounts Payable $600,000

receivables 1,575,000 Notes payable 100,000

inventories 1,125,000 other current liabilities 525,000

total current assets 2,925,000 total current liabilities 1,225,000

net fixed assets 1,350,000 long term debt 400,000

common equity 2,650,000

Total Assets 4,275,000 total liabilities and equity 4,275,000

Income Statement in Thousands of Dollars

Sales 7,500,000

Costs of goods sold 6,375,000

selling general and admin expend 933,000

Earnings before taxes (EBT) 192,000

Federal and State Taxes (25%) 38,000

Net Income 114,000