Financial statement analysis The financial statements of Zach Industries for the year ended December 31, 2019, follow a. Use the financial statements to complete the following table Assume the industry averages given in the table are applicable for both 2018 and 2019 b. Analyze Zach Industries' financial condition as it is related to (1) liquidity, (2) activity. (3) debt, (4) profitability, and (5) market. Summarize the company's overall financial condition a. The current ratio is (Round to two decimal places.) The quick ratio is (Round to two decimal places.) The inventory tumover is (Round to two decimal places.) The average collection period is days. (Rould to one decimal place) The debt ratio is % (Round to one decimal place.) The times interest eamed ratio is (Round to one decimal place.) The gross profit margin is %. (Round to one decimal place.) The net profit margin is %. (Round to one decimal place.) The return on assets is %. (Round to one decimal place) The return on common equity is % (Round to one decimal place.) The market/book value is (Round to two decimal places.) b. Analyze Zach Industries financial condition as it is related to (1) liquidity. (2) activity (3) debt, (4) profitability, and (5) market. Summarize the company's overall financial condition. (Select all the answers that apply.) A Liquidity: Zach Industries' liquidity position has deteriorated from 2018 to 2019 and is inferior to the industry average. The firm may not be able to satisfy short-term obligations as they come due 3. Activity: Zach Industries' ability to convert assets into cash has deteriorated from 2018 to 2019. Exarnation into the cause of the 20.5-day increase in the average collection period is warranted. Inventory turnover has also decreased for the period under review and is fair compared to industry. The firm may be holding slightly excessive inventory CC Debt: Zach Industries' debt position has improved since 2018 and is below average. Zach Industries' ability to service interest payments has deteriorated and is below the industry average D. Profitability: Although Zach Industries' gross profit margin is below its industry average, indicating high cost of goods sold, the firm has a superior not proft margin in comparison to average. The firm has lower than average operating expenses. The firm has a superior return on investment and return on equity in comparison to the industry and shows an upward trend E Market: Zach Industries'increase in their market price relative to their book value per share indicates that the firm's performance has been interpreted as more positive in 2019 than in 2018 and it is a little higher than the industry ols Click to select your answer(s). X the company Each Industries ndition Data Table on common equil (Click the icon here in order to copy the contents of the data table below into a spreadsheet.) book value is Actual 2019 the company's Zach Industries ondition. (Select not be able to Ratio Industry average Current ratio 1.81 Quick ratio 0.70 Inventory turnover 2.47 Average collection period 36.7 days Debt ratio 64.6% Times interest earned ratio Gross profit margin 38% Net profit margin 3.8% Return on total assets 4.3% Return on common equity 10.2% Market/book ratio "Based on a 365-day year and end-of-year figures Actual 2018 1.85 0.78 2.56 35.7 days 66.6% 4.1 40% 3.9% 4.3% 8.7% quidity: Zach Ind ort-term obligation tivity: Zach Indus erage collection Iding slightly excel ibt: Zach Industrie below the industry ofitability: Althou argin in compariso mparison to the in arket: Zach Indus sitive in 2019 thar 3.9 5.5-day increa Bustry. The fimm bnts has deterie 14 1.5 has a superior and return on Print Done been interpret Data Table t analys statemer ustries' 2018 and the compa (Click the icon here in order to copy the contents of the data table below into a spreadsheet.) non equity lue is $159,800 105,800 $54,000 the compa lustries' (Select not be able Zach Industries Income Statement for the Year Ended December, 31, 2019 Sales revenue Less: Cost of goods sold Gross profits Less: Operating expenses Selling expense General and administrative expenses Lease expense Depreciation expense Total operating expense Operating profits Less: Interest expense Net profits before taxes Less: Taxes Net profits after taxes 20.5-day in dustry. The Cach Indu mbligation ach Indus llection pe mtly exces Industrie industry y: Althoug comparison to the ind ch Industry 2019 than $15,600 10,000 1,050 10,100 $36,750 $17.250 5,900 $11,350 4,310 $7,040 hents has de has a supe nt and retur (Click the icon here in order to copy the contents of the data table below into a spreadsheet.) -as been inte 7h Inductrine Dalanen Chat or answer Print Done mer es' Zach Industries Balance Sheet December 31, 2019 equit Assets Cash $450 ies' tecte Marketable securities Accounts receivable Inventories Total current assets Land Buildings and equipment Less: Accumulated depreciation Net fixed assets Total assets 980 24,600 46,000 $72,030 $26,300 89,500 38,000 $77,800 $149,830 Indu ations ndus on pe axces istries (Click the icon here in order to copy the contents of the data table below into a spreadsheet.) ustry thoug arison he ind Liabilities and Stockholders' Equity Accounts payable Notes payable Total current liabilities Long-term debt Common stock $21,600 46,700 $68,300 $23,000 $31.000 dust than swer Print Done Data Table nalys Cemer ries'f equit Marketable securities Accounts receivable Inventories Total current assets Land Buildings and equipment Less: Accumulated depreciation Net fixed assets Total assets 980 24,600 46,000 $72,030 $26,300 89,500 38,000 $77,800 $149,830 tries' electa (Click the icon here in order to copy the contents of the data table below into a spreadsheet.) Indu gation Indus tion po exces ustrie dustry Althoug parisol the ing Liabilities and Stockholders' Equity Accounts payable $21,600 Notes payable 46,700 Total current liabilities $68,300 Long-term debt $23,000 Common stock $31,000 Retained earnings $27,530 Total liabilities and stockholders' equity $149,830 *The firm's 3,000 outstanding shares of common stock closed 2019 at a price of $32 per share. Industri 9 than nswer Print Done