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 $610,000 long-term loan from Gulfport State Bank, $155,000 of which will be used to bolster the Cash account and $455,000 of which will be used to modernize equipment. The companys financial statements for the two most recent years follow:

Sabin Electronics
Comparative Balance Sheet
	This Year		Last Year
Assets
Current assets:
Cash	$	114,000	$	260,000
Marketable securities		0		29,000
Accounts receivable, net		620,000		410,000
Inventory		1,055,000		705,000
Prepaid expenses		30,000		33,000
Total current assets		1,819,000		1,437,000
Plant and equipment, net		1,977,800		1,480,000
Total assets	$	3,796,800	$	2,917,000
Liabilities and Stockholders Equity
Liabilities:
Current liabilities	$	855,000	$	410,000
Bonds payable, 12%		800,000		800,000
Total liabilities		1,655,000		1,210,000
Stockholders' equity:
Common stock, $15 par		800,000		800,000
Retained earnings		1,341,800		907,000
Total stockholders equity		2,141,800		1,707,000
Total liabilities and stockholders' equity	$	3,796,800	$	2,917,000

Sabin Electronics
Comparative Income Statement and Reconciliation
	This Year		Last Year
Sales	$	5,550,000	$	4,680,000
Cost of goods sold		3,985,000		3,560,000
Gross margin		1,565,000		1,120,000
Selling and administrative expenses		675,000		570,000
Net operating income		890,000		550,000
Interest expense		96,000		96,000
Net income before taxes		794,000		454,000
Income taxes (30%)		238,200		136,200
Net income		555,800		317,800
Common dividends		121,000		100,000
Net income retained		434,800		217,800
Beginning retained earnings		907,000		689,200
Ending retained earnings	$	1,341,800	$	907,000

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 amount of working capital. b. The current ratio. (Round your answers to 2 decimal places.) c. The acid-test ratio. (Round your answers to 2 decimal places.) d. The average collection period. (The accounts receivable at the beginning of last year totaled $360,000.) (Use 365 days in a year. Round your intermediate calculations and final answers to 2 decimal place.) e. The average sale period. (The inventory at the beginning of last year totaled $610,000.) (Use 365 days in a year. Round your intermediate calculations and final answers to 2 decimal place.) f. The operating cycle. (Use 365 days in a year. Round your intermediate calculations and final answers to 2 decimal place.) g. The total asset turnover. (The total assets at the beginning of last year were $2,890,000.) (Round your answers to 2 decimal places.) h. The debt-to-equity ratio. (Round your answers to 2 decimal places.) i. The times interest earned ratio. (Round your answers to 2 decimal places.) j. The equity multiplier. (The total stockholders equity at the beginning of last year totaled $1,697,000.) (Round your answers to 2 decimal places.)

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		This Year		Last Year
a.	Working capital			0
b.	Current ratio
c.	Acid-test ratio
d.	Average collection period		days		days
e.	Average sale period		days		days
f.	Operating cycle		days		days
g.	Total asset turnover
h.	Debt-to-equity ratio
i.	Times interest earned ratio
j.	Equity multiplier