Problem 12-6B Use ratios to analyze risk and profitability (LO12-3, 12-4)

[The following information applies to the questions displayed below.] Income statement and balance sheet data for The Athletic Attic are provided below.

THE ATHLETIC ATTIC
Income Statements
For the years ended December 31
		2022			2021
Net sales	$	10,680,000		$	9,100,000
Cost of goods sold		6,980,000			5,600,000
Gross profit		3,700,000			3,500,000
Expenses:
Operating expenses		1,620,000			1,570,000
Depreciation expense		200,000			200,000
Interest expense		42,000			42,000
Income tax expense		424,000			370,000
Total expenses		2,286,000			2,182,000
Net income	$	1,414,000		$	1,318,000

THE ATHLETIC ATTIC
Balance Sheets
December 31
		2022				2021				2020
Assets
Current assets:
Cash	$	227,000			$	156,000			$	208,000
Accounts receivable		992,000				742,000				762,000
Inventory		1,727,000				1,357,000				1,027,000
Supplies		132,000				102,000				77,000
Long-term assets:
Equipment		1,180,000				1,180,000				1,180,000
Less: Accumulated depreciation		(620,000	)			(420,000	)			(220,000	)
Total assets	$	3,638,000			$	3,117,000			$	3,034,000
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	180,800			$	111,000			$	88,800
Interest payable		4,200				0				4,200
Income tax payable		42,000				37,000				32,000
Long-term liabilities:
Notes payable		520,000				520,000				520,000
Stockholders' equity:
Common stock		620,000				620,000				620,000
Retained earnings		2,271,000				1,829,000				1,769,000
Total liabilities and stockholders equity	$	3,638,000			$	3,117,000			$	3,034,000

Problem 12-6B Part 2

2. Calculate the following profitability ratios for 2021 and 2022: (Round your answers to 1 decimal place.)

Gross Profit Ratio _____________ For 2021.

Gross Profit Ratio ________________ for 2022

Return on assets for 2021 and 2022

profit margin for 2021 and 2022

asset turnover 2021 and 2022.