Paul Sabin organized Sabin Electronics 10 years ago to produce and sell several electronic devices on which he had secured patents. Although the company has been fairly profitable, it is now experiencing a severe cash shortage. For this reason, it is requesting a $530,000 long-term foan from Gulfport State Bank, $115,000 of which will be used to bolster the Cash account and $415,000 of which will be used to modemize equipment. The company's financial statements for the two most recent years follow During the past yeat, the compary introduced several new product lines and raised the seling prices on a number of old product lines During the past year, the company introduced several new product lines and raised the selling prices on a number of old product lines in order to improve its profit margin. The company also hired a new sales manager, who has expanded sales into several new territorles. Sales terms are 3/10, n/30. All sales are on account. Required: 1. To assist in approaching the bank about the loan. Poul has asked you to compute the following ratios for both this year and last year: 3. The amount of working capital b. The current ratio c. The acid.test ratio d. The average collection period, (The accounts receivable at the beginning of last year totaled $280,000 ) c. The average sale period. (The inventory at the beginning of last year totaled $530,000.) f. The operating cycle 9. The total asset turnovec. (The total assets at the beginning of last year were $2,510,000 ) h. The debt-to-equity ratio The times interest earned ratio. 1. The equity multiplier. (The total stockholders' equity at the beginning of last year totaled $1,361,000.) 2. For both this year and last year a. Present the balance sheet in common-size format for both this year and last year b. Present the income statement in common-size format down through net income for both this year and last year Complete this question by entering your answers in the tabs below. To assist in approaching the bank about the loan, Paul has asked you to compute the following ratios for both this year and last year: a. The arnount of working capital. b. The current ratio. (Round your answers to 2 dedimal places.) c. The acid test ratio. (Round your answers to 2 decimal places.) d. The average collection poriod. (The accounts receivable at the beginning of tast vear totaled 1280,000 ) (Round your intermedate calculations and final answers to 2 decimal place. Vae Jos days io a ynat) e. The average sale period. (the inventory at the beginning of last year totaled 5530,000 ) (found your intermedlate calculations and final answers to 2 decimal place, USe 365 days in a year. t. The cperating cycle. (Round pour intermediate calcufations and final aniswers to 2 decimal place. Use 365 days in a year) 9. The total asset tumover. (The total assets at the beginning of last year were $2,510,000.) (Hlound your answers to 2 dedimal places.) h. The debt: to equity ratio. (Round your answenn to 2 decimal places.) \begin{tabular}{|l|l|l|l|l|} \hline a. Working capital & \multicolumn{2}{|c|}{ This Year } & & \\ \hline b. Current ratio & & & \\ \hline c. Acid-test ratio & & & \\ \hline d. Average collection period & & & & dear \\ \hline e. Average sale period & & days & & days \\ \hline f. Operating cycle & & days & & \\ \hline 9. Total asset turnover & & & & \\ \hline h. Debt-to-equily ratio & & & \\ \hline i. Times interest earned ratio & & & \\ \hline j. Equity multiplier & & & & \\ \hline \end{tabular} Sabin Electronics Common-Size Balance Sheets Sabin Electronics Common-Size Income Statements \begin{tabular}{|l|l|l|l|l|} \hline Sales & \multicolumn{2}{|c|}{ This Year } & Last Year \\ \cline { 1 - 5 } & & % & & % \\ \hline Cost of goods sold & & & & \\ \hline Gross margin & 0.0 & & 0.0 \\ \hline Selling and administrative expenses & & & & \\ \hline Net operating income & 0.0 & & 0.0 \\ \hline Interest expense & & & & \\ \hline Net income before taxes & 0.0 & & 0.0 \\ \hline Income taxes & & & & \\ \hline Net income & 0.0 & % & 0.0 & % \\ \hline \end{tabular} Paul Sabin organized Sabin Electronics 10 years ago to produce and sell several electronic devices on which he had secured patents. Although the company has been fairly profitable, it is now experiencing a severe cash shortage. For this reason, it is requesting a $530,000 long-term foan from Gulfport State Bank, $115,000 of which will be used to bolster the Cash account and $415,000 of which will be used to modemize equipment. The company's financial statements for the two most recent years follow During the past yeat, the compary introduced several new product lines and raised the seling prices on a number of old product lines During the past year, the company introduced several new product lines and raised the selling prices on a number of old product lines in order to improve its profit margin. The company also hired a new sales manager, who has expanded sales into several new territorles. Sales terms are 3/10, n/30. All sales are on account. Required: 1. To assist in approaching the bank about the loan. Poul has asked you to compute the following ratios for both this year and last year: 3. The amount of working capital b. The current ratio c. The acid.test ratio d. The average collection period, (The accounts receivable at the beginning of last year totaled $280,000 ) c. The average sale period. (The inventory at the beginning of last year totaled $530,000.) f. The operating cycle 9. The total asset turnovec. (The total assets at the beginning of last year were $2,510,000 ) h. The debt-to-equity ratio The times interest earned ratio. 1. The equity multiplier. (The total stockholders' equity at the beginning of last year totaled $1,361,000.) 2. For both this year and last year a. Present the balance sheet in common-size format for both this year and last year b. Present the income statement in common-size format down through net income for both this year and last year Complete this question by entering your answers in the tabs below. To assist in approaching the bank about the loan, Paul has asked you to compute the following ratios for both this year and last year: a. The arnount of working capital. b. The current ratio. (Round your answers to 2 dedimal places.) c. The acid test ratio. (Round your answers to 2 decimal places.) d. The average collection poriod. (The accounts receivable at the beginning of tast vear totaled 1280,000 ) (Round your intermedate calculations and final answers to 2 decimal place. Vae Jos days io a ynat) e. The average sale period. (the inventory at the beginning of last year totaled 5530,000 ) (found your intermedlate calculations and final answers to 2 decimal place, USe 365 days in a year. t. The cperating cycle. (Round pour intermediate calcufations and final aniswers to 2 decimal place. Use 365 days in a year) 9. The total asset tumover. (The total assets at the beginning of last year were $2,510,000.) (Hlound your answers to 2 dedimal places.) h. The debt: to equity ratio. (Round your answenn to 2 decimal places.) \begin{tabular}{|l|l|l|l|l|} \hline a. Working capital & \multicolumn{2}{|c|}{ This Year } & & \\ \hline b. Current ratio & & & \\ \hline c. Acid-test ratio & & & \\ \hline d. Average collection period & & & & dear \\ \hline e. Average sale period & & days & & days \\ \hline f. Operating cycle & & days & & \\ \hline 9. Total asset turnover & & & & \\ \hline h. Debt-to-equily ratio & & & \\ \hline i. Times interest earned ratio & & & \\ \hline j. Equity multiplier & & & & \\ \hline \end{tabular} Sabin Electronics Common-Size Balance Sheets Sabin Electronics Common-Size Income Statements \begin{tabular}{|l|l|l|l|l|} \hline Sales & \multicolumn{2}{|c|}{ This Year } & Last Year \\ \cline { 1 - 5 } & & % & & % \\ \hline Cost of goods sold & & & & \\ \hline Gross margin & 0.0 & & 0.0 \\ \hline Selling and administrative expenses & & & & \\ \hline Net operating income & 0.0 & & 0.0 \\ \hline Interest expense & & & & \\ \hline Net income before taxes & 0.0 & & 0.0 \\ \hline Income taxes & & & & \\ \hline Net income & 0.0 & % & 0.0 & % \\ \hline \end{tabular}