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 Cash Accounts recelvable, net Merchandise inventory , , , . . . . Prepaid expenses .... .. ...35,000 70,000 3.500 Property and equipment, net . . . . . . . . . .. Total assets Liabilities and Stockholders' Equity ...115,000 .185,000 $300.000 Liabilities Current liablities Bonds payable, 10% 50,000 80.000 Total liabilities 130,000 Stockholders' equity $ 30,000 140,000 170,000 $300,000 Common stock, $5 por value-.... Retained eamings Total stockholders equity Total labilities and equity Castile Products, Inc. Income Statement For the Year Ended December 31 Sales $420,000 Selling and administrative expenses .. 89.500 8,000 Net income before taxes 30,000 9,000 $ 21,000 Account balances at the beginning of the year were: accounts receivable, $25,000, and inventory $60,000. All sales were on account EXERCISE 15-9 Financial Ratios for Assessing Proftability and Managing bt [Lo15-4, LO15-5] Refer to the financial statements for Castle Products, Inc., in Exercise 15-8. Assets at the beginning of year totaled $280,000, and the stockholders' equity totaled $161,600 Required: ompute 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