Part I:Calculate the following ratios based on theIncome Statementand Balance Sheet:

Profitability Ratios: 1. Profit Margin = Net Income / Total Sales 2. Return on assets = Net Income / Total Assets 3. Return on equity = Net Income / Stockholders' Equity

Asset Utilization Ratios: 4. Receivables turnover = Sales on credit / accounts receivable 5. Average collection period = Accounts receivable / Average daily credit sales 6. Inventory turnover =Sales / Inventory 7. Fixed asset turnover = Sales / Fixed assets 8. Total asset turnover = Sales / Total assets

Liquidity Ratios: 9. Current ratio = Current assets / Current liabilities 10. Quick ratio = Current assets - inventory / current liabilities

Debt Utilization Ratios: 11. Debt to total assets = Total debt / Total assets 12. Times interest earned = Income before interest and taxes / Interest paid 13. Fixed charge coverage = Income before fixed charges (exclude lease payments) / Fixed charges

				National American Corporation
				Income Statement
				For the year ending December 31, 201X
Sales (all on credit)						$4,000,000
Cost of goods sold						$3,000,000
Gross profit						$1,000,000
Selling, general & administrative expense			$450,000
Operating profit						$550,000
Interest expense						$50,000
Extraordinary loss						$200,000
Net income before taxes					$300,000
Taxes (33% marginal tax bracket)				$100,000
Net income						$200,000
SGA expense includes $50,000 lease expense
				National American Corporation
				Balance Sheet
				December 31, 201X
Assets
Current Assets:
	Cash						$30,000
	Marketable Securities				$50,000
	Accounts Receivable			$400,000
	Less: Allowance for bad debt			$50,000	$350,000
	Inventory					$370,000
	Total Current Assets				$800,000
Fixed Assets:
	Plant and equipment			$2,000,000
	Less: Accumulated depreciation		$1,200,000
	Net Plant and Equipment				$800,000
Total Assets						$1,600,000
Liabilities and Stockholders' Equity
Current Liabilities:
	Accounts Payable					$50,000
	Notes Payable					$250,000
	Total Current Liabilities				$300,000
Long Term Liabilities
	Mortgage Payable					$300,000
	Total Liabilities					$600,000
Stockholders' Equity
	Common Stock, $1 par value, 400,000 shares		$400,000
	Retained Earnings					$600,000
	Total Stockholders' Equity				$1,000,000
Total Liabilities and Stockholders' Equity				$1,600,000