Lydex Company$$s financial statements for the last two years are as follows:

Lydex Company

Comparative Balance Sheet

This Year Last Year

Assets

Current assets:

Cash $ $860,000$ $ $1,100,000$

Marketable securities $0300,000$

Accounts receivable, net $2,300,0001,400,000$

Inventory $3,500,0002,000,000$

Prepaid expenses $240,000180,000$

Total current assets $6,900,0004,980,000$

Plant and equipment, net $9,320,0008,950,000$

Total assets $ $16,220,000$ $ $13,930,000$

Liabilities and Stockholders' Equity

Liabilities:

Current liabilities $ $3,910,000$ $ $2,780,000$

Note payable, $10\%3,600,0003,000,000$

Total liabilities $7,510,0005,780,000$

Stockholders' equity:

Common stock, $$75$ par value $7,500,0007,500,000$

Retained earnings $1,210,000650,000$

Total stockholders' equity $8,710,0008,150,000$

Total liabilities and stockholders' equity $ $16,220,000$ $ $13,930,000$

Lydex Company

Comparative Income Statement and Reconciliation

This Year Last Year

Sales $($all on account$)$ $ $15,760,000$ $ $12,580,000$

Cost of goods sold $12,608,0009,435,000$

Gross margin $3,152,0003,145,000$

Selling and administrative expenses $1,592,0001,564,000$

Net operating income $1,560,0001,581,000$

Interest expense $360,000300,000$

Net income before taxes $1,200,0001,281,000$

Income taxes $(30\%)360,000384,300$

Net income $840,000896,700$

Common dividends $280,000448,350$

Net income retained $560,000448,350$

Beginning retained earnings $650,000201,650$

Ending retained earnings $ $1,210,000$ $ $650,000$

The following financial data and ratios are typical of companies in Lydex Company$$s industry:

Current ratio $2\mathrm{.}3$

Acid$-$test ratio $1\mathrm{.}0$

Average collection period $30$ days

Average sale period $60$ days

Return on assets $8\mathrm{.}2\%$

Debt$-$to$-$equity ratio $0\mathrm{.}7$

Times interest earned ratio $5\mathrm{.}8$

Price$-$earnings ratio $10$

$3.$ To assess the company$$s liquidity and asset management, compute the following for this year and last year:

Working capital.

The current ratio.

Note: Round your final answers to $2$ decimal places.

The acid$-$test ratio.

Note: Round your final answers to $2$ decimal places.

The average collection period. $($The accounts receivable at the beginning of last year totaled $$1,570,000.)$

Note: Use $365$ days in a year. Round your intermediate calculations and final answers to $2$ decimal place.

The average sale period. $($The inventory at the beginning of last year totaled $$1,930,000.)$

Note: Use $365$ days in a year. Round your intermediate calculations and final answers to $2$ decimal place.

The operating cycle.

Note: Round your intermediate calculations and final answers to $2$ decimal place.

The total asset turnover. $($The total assets at the beginning of last year totaled $$12,970,000.)$

Note: Round your final answers to $2$ decimal places.