OB-12 bed int ences mer, Inc. has provided its recent financial statements. The Controller has asked you to use this information to compute and interpret financial ratios that managers are going to use to assess liquidity and use for asset and debt management purposes. Use the information included in the Excel Simulation and the Excel functions described below to complete the task Cell Reference: Allows you to refer to data from another cell in the worksheet. From the Excel Simulation below, if in a blank cell, "-87" was entered, the formula would output the result from cell 87, or 360,000 in this example. Basic Math functions: Allows you to use the basic math symbols to perform mathematical functions. You can use the following keys: + (plus sign to add), (minus sign to subtract), (asterisk sign to multiply), and/ (forward slash to divide). From the Excel Simulation below, if in a blank cell C13-C14" was entered, the formula would add the values from those cells and output the result, or 1,900,000 in this example. If using the other math symbols the result would output an appropriate answer for its function. ROUND function: Allows you to round a number or result of a formula calculation to a specific number of digits. The syntax of the ROUND function is ROUND(numbernum digits)" and returns the result of your formula rounded to a particular number of digits. The number argument can be a cell reference to a number or a formule itself that results in a number. The num digits argument is the number of digits you want to round. The num digits value rounds based on basis mathematical rounding rules, where anything below 5 will round down and anything 5 and above rounds up. Also, the num digits value should be a positive value to round to any number of decimal places, while a negative value would round to the left of the decimal place, and a zero would round to the nearest whole number. If the value 1,253.5693 was entered in cell A1, it can be used in the ROUND function as the number reference. In this example, if the value in cell A1 should be rounded to 2 decimal places, in a new cell the function would be written as "-ROUND(A1.21" and would result in as 1,253.57 in this example. if the number in cell A1 should be rounded to the nearest hundred place, in a new cell the function would be written as ROUND(A1,-2) and would result in 1,300 in this example. 2 3 4 Recent financial statements for Zimmer, Inc. are as follows: Zimmer Company Comparative Balance Sheet 5 Assets 6 Current assets: 7 Cash 8 Marketable securities 9 Accounts receivable, net 10 Inventory 11 Other current assets 12 Total current assets 13 Plant and equipment, net 14 Other assets 15 Total assets 16 Liabilities and Stockholders' Equity 17 Current Liabilities: 18 Accounts payable 19 Short-term bank loans 20 Accrued payables 21 Other current liabilities 22 Total current liabilities 23 Bonds payable, 10% 24 Total liabilities 25 Stockholders' equity 261 Common stock 27 Retained earnings 28 Total stockholders' equity 29 Total liabilities and stockholders' equity 30 Sheet1 This Year Last Year Zimmer Company Income Statement This Year $ 360,000 $ 310,000 Sales (all on account) $4,980,000 220,000 80,000 Cost of goods sold 2.988.000 775,000 700,000 Gross margin 1.992.000 925,000 750,000 Selling and administrative expenses 355.000 2,635,000 195.000 Operating expenses 985,500 2,035,000 Depreciation and amortization 410,500 1,975,000 1,800,000 General and administrative expenses 150,000 75.000 4685.000 100.000 Total selling and administrative expenses 1.546.000 3.935.000 Net operating income 446,000 Interest expense 60.000 Net income before taxes 386,000 $ 250,000 $ 225,000 Income taxes 135.100 750,000 550,000 600,000 Net income 395,000 250.900 275,000 223.400 Additional information: 1,825,000 575,000 2,400,000 400,000 1.843,400 1.443,400 Dividend per share paid in current year Market price of shares at year end Par value of common stock per share $ 1.00 42.00 20.00 1,150,000 1.135.000 2285.000 1.150,000 941,600 2.091,600 Number of share outstanding 4.685.000 3.935.000 + 28 Total stockholders' equity 2,285,000 2,091,600 4.685.000 $3.935.000 29 Total liabilities and stockholders' equity 30 31 Required: 32 Compute the following ratios for the current year only: 33 Gross margin percentage 34 Current ratio (rounded to two decimal places) 35 Acid-test ratio (rounded to two decimal places) 36 Accounts receivable turnover (rounded to two decimal places) 37 Average collection period (rounded to the nearest whole day) 38 Inventory turnover ratio (rounded to two decimal places) 39 Average sales period (rounded to the nearest whole day) 40 Debt-to-equity ratio (rounded to two decimal places) 41 Times interest earned (rounded to two decimal places) 42 Book value per share (rounded to two decimal places) 43 Earnings per share (rounded to two decimal places) 44 Dividend payout ratio (rounded to three decimal places) 45 Dividend yield ratio (rounded to three decimal places) 46 Price-earnings ratio (rounded to two decimal places) 47 48 49 50 +