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 company's overall financial condition. a. The current ratio is 1.04 (Round to two decimal places) The quick ratio is 0.38 (Round to two decimal places.) The inventory turnover is 2.33 (Round to two decimal places) The average collection period is 56. 2 days. (Round to one decimal place) The debt ratio is 34.9% (Round to one decimal place) The times interest earned ratio is 4.72 (Round to one decimal place.) The gross profit margin is 33.8%. (Round to one decimal place.) The net profit margin is 4.6%. (Round to one decimal place.) The return on assets is 49%. (Round to one decimal place) The return on common equity is 129%. (Round to one decimal place) The market book value is 0.88 (Round to two decimal places maranna . Med place) The return on common equity is 12.9% (Round to one decimal place.) The market book value is 0.88 (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) D 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 B. Activity: Zach Industries' ability to convert assets into cash has deteriorated from 2018 to 2019. Examination 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 C. 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 net profit 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 C ze Zach Industries financial condition as it is related to (1) liquidity, (2) activity, (3) ded, (9) prontality, and (5) marke ny's ove current i 0 Data Table ick ratio entory (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) erage ca Actual 2019 bt ratio i 0 Actual 2018 1.84 .71 2.59 357 days 67.6% mes inter Toss profil Ratio Industry average Current ratio 1.80 Quick ratio 0. 70 Inventory turnover" 250 Average collection period 36.7 days Debt ratio 65.6% Times interest eamed ratio Gross profit margin 38% Net profit margin 40% Retum on total assets Return on common equitiy 11.1% Marketbook ratio 12 "Based on a 365-day year and end-of-year figures 4.0 4.2 40% et profitne 4.1% 45 eturn on a 4.5% 9.6% eturn on market/bod Print Done alyze Zac ompany's on the icon located on the top-right corner of the data table below in order to copy its ents into a spreadsheet.) Sumn $159,700 105,700 $54000 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 $15,600 10,000 1,000 10.000 $36,600 $17.400 5,800 $11,600 4,320 $7.280 Zach Industries Balance Sheet December 31, 2019 Assets Cash Marketable securities Accounts receivable Inventories | Summar $470 950 24600 45 300 The firm Print Done Net profits before taxes Less: Taxes Net profits after taxes $11,600 4,320 $7,280 Zach Industries Balance Sheet December 31, 2019 Assets Cash $470 Marketable securities 950 Accounts receivable 24,600 Inventories 45,300 Total current assets $71,320 Land $25.600 Buildings and equipment 89,700 Less: Accumulated depreciation 38,500 Net fixed assets S76,800 Total assets W S148, 120 Liabilities and Stockholders' Equity Accounts payable $21.600 Notes payable 47 200 Total current liabilities $68,800 Long-term debt $22,930 Common stock $31.500 Retained earnings $24.890 Total liabilities and stockholders equity $148. 120 The firm's 3.500 outstanding shares of common stock closed 2019 at a price of $23 per share Thef