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I need help with this. Comprehensive Ratio Analysis Data for Lozano Chip Company and its industry averages follow. Lozano Chip Company: Balance Sheet as of

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Comprehensive Ratio Analysis Data for Lozano Chip Company and its industry averages follow. Lozano Chip Company: Balance Sheet as of December 31, 2019 (Thousands of Dollars) Cash $ 230,000 Accounts payable Receivables 1,575,000 Notes payable Inventories 1,125,000 Other current liabilities Total current assets $2,930,000 Total current liabilities Net fixed assets 1,325,000 Long-term debt Common equity Total assets $4,255,000 Total liabilities and equity $ 600,000 100,000 540,000 $1,240,000 400,000 2,615,000 $4,255,000 Lozano Chip Company: Income Statement for Year Ended December 31, 2019 (Thousands of Dollars) Sales $7,500,000 Cost of goods sold 6,375,000 Selling, general, and administrative expenses 929,000 Earnings before interest and taxes (EBIT) $ 196,000 Interest expense 40,000 Earnings before taxes (EBT) $ 156,000 Federal and state income taxes (25%) 39,000 Net income $ 117,000 % % % a. Calculate the indicated ratios for Lozano. Do not round intermediate calculations. Round your answers to two decimal places. Ratio Lozano Industry Average Current assets/Current liabilities 2.0 Days sales outstanding (365-day year) days 35.0 days COGS/Inventory 6.7 Sales/Fixed assets 12.1 Sales/Total assets 3.0 Net income/Sales 1.2% Net income/Total assets 3.6% Net income/Common equity 9.0% Total debt/Total assets % 10.0% Total liabilities/Total assets % 60.0% b. Use the extended DuPont equation to calculate ROE for both Lozano and the industry. Do not round intermediate calculations. Round your answers to two decimal places. For the firm, ROE is For the industry, ROE is %. C. Outline Lozano's strengths and weaknesses as revealed by your analysis. The firm's days sales outstanding is more than twice as long as the industry average, indicating that the firm should -Select- v credit or enforce a -Select-stringent collection policy. The total assets turnover ratio is well - Select the industry average so sales should be -Select- assets -Select- , or both. While the company's profit margin is -Select-than the industry average, its other profitability ratios are -Select- compared to the industry - net income should be -Select- given the amount of equity and assets. %

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