In the right hand column below, certain financial ratios are listed. To the left of each ratio is a business transaction or event relating to the operating activities of Delta Company (each transaction should be considered independently) Required: Indicate the effect that each business transaction or event would have on the ratio listed opposite to it. State the effect in terms of increase, decrease, or no effect on the ratio involved. In all cases, assume that the current assets exceed the current liabilitles both before and after the event or transaction. Ratio Effect on Ratio Business Transaction or Event 1. Declared a cash dividend. 2. Sold inventory on account at cost. 3. Issued bonds with an interest rate of 8%. The company's return on assets is 10% Net income decreased by 10% between last year and this year. Long-term debt remained 4. unchanged 5. Paid a previously declared cash dividend. 6. The market price of the company's common stock dropped from $24.50 to $20.00. The dividend paid per share remained unchanged 7. Obsolete inventory totaling $100,000 was written off as a loss 8. Sold inventory for cash at a profit. Changed customer credit terms from 2/10, 1/30 to 2/15, 1/30 to comply with a change in 9. industry practice 10. Issued a stock dividend to common stockholders 11. The market price of the company's common stock increased from $24.50 to $30.00 12. Paid $40,000 on accounts payable. 13. Issued a stock dividend to common stockholders 14. Paid accounts payable 15. Purchased Inventory on account. 16. Wrote off an uncollectible account against the Allowance for Bad Debts. Current ratio Acid-test ratio Retur on equity Times interest eamed Current ratio Dividend payout ratio Inventory turnover ratio Debt-to-equity ratio Accounts receivable turnover ratio Book value per share Book value per share Working capital Earnings per share Debt-to-equity ratio Acid-test ratio Current ratio 6 of 6 Next H: