Financial accounting: Ratio analysis The joint-stock company Copy PLC manufactures, sells and leases photo- copiers. Its 2016 financial statement contains the following information: Balance sheet as at December 31st (in million ) 2015 2016 447 320 Assets Fixed operating assets Leased equipment Financial assets Inventories Trade accounts receivable Other accounts receivable Prepaid expenses Cash and cash equivalents Total Assets 350 351 49 323 376 46 52 45 1,524 36 44 Liabilities Share capital Share premium reserve General reserve Revaluation surplus Long-term provisions 7% convertible bond loan Private subordinated loans Bank Accounts payable (including tax and dividend payable) Advance payments from customers Total Liabilities 162 150 124 1,524 142 1,588 Leased equipment as well as financial assets belong to the category of fixed assets. The revaluation surplus is part of the organization's equity. Provisions as well as private subordinated loans belong to the category of non-current liabilities. Profit and loss account 2016 (in million ) 2015 2016 Sales 1,801 1,825 Operating costs Depreciation fixed assets Depreciation leased equipment Costs of sales 1,556 56 66 1,678 1,555 57 85 1,697 Operating income Interest paid Profit before taxes 123 62 61 128 47 81 Taxes After-tax profit 1931 42 50 a. Assess changes in the static liquidity of Copy PLC in 2016 by calcu- lating its net working capital and current ratio at the start and the end of the year. b. Assess the long-term solvency of Copy PLC in 2016 by calculating its debt ratio at the start and at the end of the year. C. Assess the changes in the financial resilience of Copy PLC by calcu- lating its interest coverage ratio in 2015 and 2016. d. Provide a general definition of the concept of rate of return. Calcu- late the return on total assets (ROA) for Copy PLC. e. Calculate the return on equity after tax (ROE) of Copy PLC in 2016. By what term is this type of financial statement analysis known