Industry Actual 2019 30 days Dana Dairy Products Key Ratios Actual Average 2018 Current ratio 1.3 1.0 Quick ratio 0.8 0.75 Average collection period 23 days Inventory turnover 21.7 Debt ratio 64.7% 50% Times interest earned 4.8 5.5 Gross profit margin 13.6% 12.0% Net profit margin 1.0% 0.5% Return on total assets 2.9% 2.0% Return on equity 8.2% 4.0% 19 Income Statement Dana Dairy Products For the Year Ended December 31, 2019 Sales revenue $100,000 Less: Cost of goods sold 87,000 Gross profits $ 13,000 Less: Operating expenses 11,000 Operating profits $ 2,000 Less: Interest expense 500 Net profits before taxes $ 1,500 Less: Taxes (40%) 600 $ 900 Net profits after taxes Balance Sheet Dana Dairy Products December 31, 2019 Assets Cash Accounts receivable Inventories Total current assets Gross fixed assets $35,000 Less: Accumulated depreciation 13,250 Net fixed assets Total assets $1,000 8,900 4,350 $14,250 21,750 $36,000 Liabilities & Stockholders' Equity Accounts payable Accruals Total current liabilities Long-term debt Total liabilities Common stock Retained earnings Total stockholders' equity Total liabilities & stockholders equity $ 9,000 6,675 $15,675 4,125 $19,800 1,000 15,200 $16,200 $36,000 The current ratio for Dana Dairy Products in 2019 was (See Table 3.2) O A. 1.58 OB. 1.10 OC. 0.63 OD. 0.91