1. For each individual ratio for each company, Your comments for each ratio should include more than just a definition or increase or decrease of the ratio. You should focus on interpreting each ratio numberfor the company and support your comments.
2. Use the ratio results by category to form and support conclusion by Liquidity, Solvency and Profitability. Then use to complete the Overall Conclusion as to the financial results of the company (ratios described in the chapters covered and summarized in Chapter 14 of your textbook). Conclude by stating whether the company is the better employment /investment opportunity and why.

Stargel Inc.
Comparative Balance Sheet
December 31, 20Y2 and 20Y1
			20Y2		20Y1
Assets
Current assets:
	Cash		$500,000		$400,000
	Marketable securities		1,010,000		1,000,000
	Accounts receivable (net)		740,000		510,000
	Inventories		1,190,000		950,000
	Prepaid expenses		250,000		229,000
		Total current assets	$3,690,000		$3,089,000
Long-term investments			2,350,000		2,300,000
Property, plant, and equipment (net)			3,740,000		3,366,000
Total assets			$9,780,000		$8,755,000
Liabilities
Current liabilities			$900,000		$880,000
Long-term liabilities:
	Mortgage note payable, 10%		$200,000		$0
	Bonds payable, 10%		1,500,000		1,500,000
		Total long-term liabilities	$1,700,000		$1,500,000
Total liabilities			$2,600,000		$2,380,000
Stockholders' Equity
Preferred $0.90 stock, $10 par			$500,000		$500,000
Common stock, $5 par			500,000		500,000
Retained earnings			6,180,000		5,375,000
	Total stockholders' equity		$7,180,000		$6,375,000
Total liabilities and stockholders' equity			$9,780,000		$8,755,000

Required:

Determine the following measures for 20Y2, rounding to one decimal place, except dollar amounts which should be rounded to the nearest cent. Use the rounded answer of the requirement for subsequent requirement, if required. Assume 365 days a year.

1. Working capital	$2,790,000
2. Current ratio	4.1
3. Quick ratio	2.5
4. Accounts receivable turnover	16
5. Number of days' sales in receivables	22.8	days
6. Inventory turnover	5
7. Number of days' sales in inventory	73	days
8. Ratio of fixed assets to long-term liabilities	2.2
9. Ratio of liabilities to stockholders' equity	0.4
10. Times interest earned	7.6
11. Asset turnover	1.1
12. Return on total assets	11.50	%
13. Return on stockholders equity	13.30	%
14. Return on common stockholders equity	13.60	%
15. Earnings per share on common stock	$8.55
16. Price-earnings ratio	14
17. Dividends per share of common stock	$0.50
18. Dividend yield	0.40	%