For the most recent year (2008) calculate the following ratios.

1.Current ratio

2.Inventory turnover

3.Rate of return on total assets

4.Accounts receivable turnover (assume all sales are on account)

5.Debt ratio.

BALANCE SHEETS 2008 2007

Assets

Cash 200 185

Accounts receivable 350 290

Allowance for bad debts (45) (25)

Inventory 260 135

Land 600 500

Buildings 295 250

Accumulated depreciation-buildings (65) (80)

Total assets 1,595 1,255

Liabilities & Owners Equity

Liabilities

Accounts payable 400 305

Wages payable 70 67

Dividends payable 30 47

Taxes payable 50 46

Long-term Bonds payable 100 100

Discount on bonds payable ( 8) (10)

Total liabilities 642 555

Owners Equity

Common stock 650 500

Retained earnings 303 200

Total owners equity 953 700

Total liabilities & owners equity 1,595 1,255

INCOME STATEMENT (2008)

Revenue 1,200

Cost of goods sold 750

Gross margin 450

Operating expenses

Wage expense 200

Depreciation expense 30

Bad debt expense 20

Bond interest expense 10

Total operating expenses 260

Net operating income 190

Gain on sale of building 40

Net income before tax 230

Income tax 69

Net income after tax 161