EXERCISE 15-8 Selected Financial Ratios [LO15-2, LO15-3, LO15-4] The financial statements for Castile Products, Inc., are given below: Castile Products, Inc. Balance Sheet December 31 Assets Current assets: Merchandise inventory Prepaid expenses .. . 35,000 70,000 3.500 Property and equipment, net..Jeeaas185.000 Total assets . * . $300,000 Liabilities and Stockholders' Equity Liabilities: Bonds payable, 10% 80,000 Stockholders equity: Total stockholders' equity170.000 Total liabilities and equity .....*.**.....$300,000 Castile Products, Inc Income Statement For the Year Ended December 31 89,500 8,000 Net income before taxes ........* .*30000 9,000 Income taxes (30%) Net income 21,000 Account balances at the beginning of the year were: accounts receivable, $25,000; and inventory, $60,000. All sales were on account. Required: Compute the following financial data and ratios 1. Working capital 2. Current ratio 3. Acid-test ratio. 4. Debt-to-equity ratio 5. Times interest earned ratio 6. Average collection period. 7. Average sale period 8. Operating cycle EXERCISE 15-9 Financial Ratios for Assessing Profitability and Managing Debt [LO15-4, LO15-5] Refer to the financial statements for Castile Products, Inc., in Exercise 15-8. Assets at the beginning of the year totaled $280,000, and the stockholders' equity totaled $161,600. Required: Compute the following: 9. Gross margin percentage. 10. Net profit margin percentage 11. Return on total assets. 12. Return on equity 13. Was financial leverage positive or negative for the year? Explain. EXERCISE 15-10 Financial Ratios for Assessing Market Performance [LO15-6] Refer to the financial statements for Castile Products, Inc., in Exercise 15-8. In addition to the data in these statements, assume that Castile Products, Inc., paid dividends of $2.10 per share during the year. Also assume that the company's common stock had a market price of $42 at the end of the year and there was no change in the number of outstanding shares of common stock during the year Required: Compute financial ratios as follows: 14. Earnings per share. 15. Dividend payout ratio. 16. Dividend yield ratio 17. Price-earnings ratio. 18. Book value per share