Presented below are the computed amounts of ratios for the Village of Riverside example appearing in the chapter. Required: a. Using the financial statements provided in Illustrations 2-5 through 2-11, compute ratios for the City of Salem. Assume the population of Salem is 52,000 and the fair value of property totals $970 million. b. For each ratio, indicate which of the two governments has a stronger financial position.

CITY OF SALEM Statement of Net Position As of December 31, 2020 Primary Government Business-type Activities Component Units Governmental Activities $ 8,242,998 3,312,992 1,072,963 Primary Government $13,057,722 13,663,326 1,103,742 $ $ 4,814,724 10,350,334 30,779 84,733 Assets Cash and cash equivalents Investments Inventory Receivables (net): Taxes receivable Accounts receivable Due from other governments Restricted assets Capital assets (net of accumulated depreciation) Total assets 2,872,611 722,215 2,872,611 3,379,541 2,657,326 27,085 1,328,448 3,933,126 1,328,448 6,228,169 2,295,043 65,690,373 87,175,726 48,894,402 69,042,608 114,584,775 156,218,334 11,170,900 11,282,718 710 2,425,447 4,340,108 493,849 473,168 2,919,296 4,813,276 2,164,521 1,342,717 3,507,238 Liabilities Accounts payable Accrued liabilities Bonds payable due within one year Bonds payable due in more than one year Total liabilities Net position Net investment in capital assets Restricted Unrestricted Total net position 39,834,882 48,764,958 18,858,187 21,167,921 58,693,069 69,932,879 710 11,197,985 23,690,970 3,933,126 10,786,672 $38,410,768 30,757,135 2,295,043 14,822,509 $47,874,687 54,448,105 6,228,169 25,609,181 $86,285,455 84,023 $11,282,008