Eastern Slope Bison, Inc. (ESB) posted the following financial information when its stock was trading at $40 and 20,000 shares were outstanding:

Balance Sheet
Cash	$ 70,000		Accounts Payable	$120,000
Accounts Receivable	110,000		Notes Payable in 1 year	200,000
Prepaid expenses	30,000		Long-term debt	140,000
Inventories	120,000
Net Plant and Equipment	630,000		Common Stock Retained earnings	350,000 150,000
	$960,000			$960,000

Income Statement
Sales		$525,000
Gain on sale of assets		15,000
Cost of goods sold		230,000
Depreciation expense		65,000
Interest expense		35,000
Net profit before taxes		210,000
Tax expense		70,000
		$140,000

Ratios: EBIT = Sales revenue operating costs

Debt ratio = Total debt / total assets

Market/book ratio = Market value per share / book value per share

Book value = Common equity / average shares outstanding

Return on assets = Net income / total assets

Quick ratio = Current assets - inventory / current liabilities

1. What is ESBs EBIT?

a.	525000 230000 + 35,000 = 310,000
b.	525000 230000 65000 = 230,000
c.	525000 + 15000 230000 65000 = 245,000
d.	525000 230000 + 35,000 = 330,000

2. What is ESBs debt ratio?

a.	(120000 + 140000) / 960000 = 27.1%
b.	(200000 + 120000) / 960000 = 33.3%
c.	(200000 + 140000) / 960000 = 35.4%
d.	(120000 + 200000 + 140000) / 960000 = 47.9%

3. What is ESBs return on assets?

a.	(525000 230000 65000) / 630000 = 69.3%
b.	(525000 230000 65000) / 960000 = 45.5%
c.	140000 / 630000 = 22.2%
d.	140000 / 960000 = 14.6%

4. What is ESBs market to book ratio (times)?

a.	40 / ( (350000 + 150000) / 20000 ) = 1.6 x
b.	40 / (350000 / 20000) = 2.3 x
c.	40 / (150000 / 25000) = 6.7 x
d.	40 x : the stock trading at $40 per share

5. What is ESBs quick ratio?

a.	(70000 + 110000 + 30000 - 120000) / 120000 = 0.75
b.	(70000 + 110000 - 120000) / (120000 + 200000) = 0.19
c.	(70000 + 110000 + 30000 + 120000) (120000 / 120000) = 329,000
d.	(70000 + 110000 + 30000 + 120000 - 120000) / (120000 + 200000) = 0.65