Given the following: comment on company XYZs use of leverage. (Assume all assets and current liabilities are operating at a 35% tax rate).

Income Statement Data
Sales Revenue				$7,120.00
Depreciation				$230.00
Interest Expense				$10.00
Pretax Income				$2,550.00
Income Taxes				$900.00
Net Income				$1,650.00
Balance Sheet Data
Current Assets				$4,850.00
Fixed Assets, Net				$2,400.00
Total Assets				$7,250.00
Current Liabilities				$3,290.00
Long-Term Debt				$100.00
Shareholders' Equity				$3,860.00
Total Liabilities and Shareholders' Equity				$7,250.00

Pre-Tax Income to Sales		0.36
Net Income to Sales		0.23
Sales / Current Assets		1.47
Sales / Fixed Assets		2.97
Sales / Total Assets		0.98
Total Liabilities / Equity		0.88
L-T Liabilities / Equity		0.03