Exercise 15-9 Financial Ratios for Assessing Profitability and Managing Debt [LO15-4, LO15-5) The financial statements for Castile Products, Inc., are given below Castile Products, Inc. Balance Sheet December 31 Assets Current assets: cash Accounts receivable, net Merchandise Inventory Prepaid expenses Total current assets Property and equipment, net Total assets Liabilities and Stockholders' Equity Liabilities: Current liabilities Bonds payable, 8% Total liabilities Stockholders' equity: Common stock, $ie par value Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ 22,eee 180,000 360,000 12, eee 574,000 878, een $1,444,000 $ 290,000 360.eee 650, eee $ 180,000 614, eee 794, 000 $1,444.000 Castile Products, Inc. Income Statement For the Year Ended December 31 Sales Cost of goods sold Gross margin Selling and administrative expenses het operating income Interest expense Net Income before taxes Income taxes (20%) Net Income $2,120,000 1,240, eee 880,000 590,000 290,000 28,800 261,200 78.360 $ 182,840 UUUUUU Gross margin Selling and administrative expenses Net operating Income Interest expense Net income before taxes Income taxes (30%) Net income 20,000 B80.eee 590, cee 290.000 28,800 261,200 78,360 $ 182,840 Account balances at the beginning of the year were: accounts receivable, $230,000, and inventory $320.000. All sales were on account. Assets at the beginning of the year totaled $1,040,000, and the stockholders' equity totaled $635,000 Required: Compute the following: (For Requirements 1 to 4. enter your percentage answers rounded to 2 decimal places (l... 0.1234 should be entered as 12.34).) 1 Gross margin percentage 2 Net profit margin percentage 3 Return on total assets 4 Return on equity 5. Was financial leverage positive or negative for the year? 1. Gross margin percentage 2. Net profit margin percentage 3. Return on total assets 4. Return on equity 5. Financial Leverage R