Pinnacle Plus declared and paid a cash dividend of $6,900 in the current year. Its comparative financial statements, prepared at December 31, reported the following summarized information: Income Statement Sales Revenue Cost of Goods Sold Gross Profit Operating Expenses Interest Expense Income before Income Tax Expense Income Tax Expense (30%) Net Income Balance Sheet Cash Accounts Receivable, Net Inventory Property and Equipment, Net Total Assets Accounts Payable Income Tax Payable Note Payable (long-term) Total Liabilities Common Stock (par $10) Retained Earnings Total Liabilities and Stockholders' Equity Required: Current Year Previous Year $125,000 $111,000 58,000 54,000 67,000 57,000 39,000 35,400 4,300 4,300 23,700 17,300 5,190 7,110 $16,590 $ 73,415 20,000 28,000 98,000 $219,415 $ 12,110 $ 35,000 15,000 41,000 108,000 $199,000 $ 34,700 650 43,000 $ 45,000 1,075 43,000 89,075 78,350 91,800 91,800 38,540 28,850 $219,415 $199,000 1. Compute the gross profit percentage in the current and previous years. Are the current year results better, or worse, than those for the previous year? 2. Compute the net profit margin for the current and previous years. Are the current year results better, or worse, than those for the previous year? 3. Compute the earnings per share for the current and previous years. Are the current year results better, or worse, than those for the previous year? 4. Stockholders' equity totaled $103,000 at the beginning of the previous year. Compute the return on equity (ROE) ratios for the current and previous years. Are the current year results better, or worse, than those for the previous year? 5. Net property and equipment totaled $113,000 at the beginning of the previous year. Compute the fixed asset turnover ratios for the current and previous years. Are the current year results better, or worse, than those for the previous year? 6. Compute the debt-to-assets ratios for the current and previous years. Is debt providing financing for a larger or smaller proportion of the company's asset growth? 7. Compute the times interest earned ratios for the current and previous years. Are the current year results better, or worse, than those for the previous year? 3. After Pinnacle Plus released its current year's financial statements, the company's stock was trading at $21. After the release of its previous year's financial statements, the company's stock price was $18 per share. Compute the P/E ratios for both years. Does it appear that investors have become more (or less) optimistic about Pinnacle's future success?