Pamplin, Inc. Balance Sheets
Assets	2012	2013
Cash	$200	$152
Accounts receivable	450	420
Inventories	551	628
Current assets	$1,201	$1,200
Plant and equipment	2,170	2,560
Less: Accumulated depreciation	(980)	(1,240)
Net plant and equipment	$1,190	$1,320
Total assets	$2,391	$2,520
Liabilities and Owners' Equity	2012	2013
Accounts payable	$200	$148
Notes payablecurrent (9% interest)	0	147
Current liabilities	$200	$295
Bonds (8.33% interest)	$599	$599
Owners' equity
Common stock	$295	$295
Paid-in capital	605	605
Retained earnings	692	726
Common equity	$1,592	$1,626
Total liabilities and owners' equity	$2,391	$2,520

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Pamplin, Inc.
Income Statements	2012	2013
Sales (all credit)	$1,198	$1,455
Cost of goods sold	(702)	(855)
Gross profit	$496	$600
Operating expenses (cash)	$(29)	$(36)
Depreciation	(215)	(195)
Total operating expenses	$(244)	$(231)
Net operating income	$252	$369
Interest expense	(54)	(63)
Earnings before taxes	$198	$306
Income taxes (40%)	(79)	(122)
Net income	$119	$184

Current ratio	5.00
Acid-test (quick) ratio	3.00
Inventory turnover	2.20
Average collection period	90.0
Debt ratio	33.0%
Times interest earned	7.00
Total asset turnover	0.75
Fixed asset turnover	1.00
Operating profit margin	20.0%
Return on equity	9.0%

a.Compute the following ratios for both 2012 and 2013 using the financial statements above:

Pamplin's 2012 current ratio is ___

b. Compare Pamplin's financial ratios to the industry norms listed above and assess each of the following attributes of the firm's financial condition: liquidity, capital structure, asset management efficiency, and profitability.