Problem #3: Using the financial statements presented for Smolira Golf below: A) Prepare a common sized balance sheet and income statement. B) Calculate the following ratios: Calculating Financial Ratios (L02Find the following financial ratios for Smolira Golf Corp. (use year-end figures rather than average values where appropriate): Short-term solvency ratios: a. Current ratio. b. Quick ratio. c. Cash ratio. Asset utilization ratios: d. Total asset turnover. e. Inventory turnover. f. Receivables turnover. Long-term solvency ratios: g. Total debt ratio h. Debt-equity ratio. Page 3 of 5 Problem 3: continued SMOLIRA GOLF CORP. 2017 and 2018 Balance Sheets Labies and Owners $ 34,385 17.801 Current liabilities Accounts payable Notes payable $ 37,837 27.766 Current assets Cash Accounts receivable Inventory Total $ 36,722 19.008 $ 42,582 16,200 36,310 S 88.496 42.632 $108,235 Other 19.864 24,634 Total $ 75,594 $ 83.416 Long-term debt $115.000 $145,000 Owners' equity Common stock and paid-in surplus $ 55,000 $ 55,000 Accumulated retained earnings 307 217 344,452 Fixed assets Net plant and equipment 464.315 519.633 Total Total liabilities and owners' equity $362.217 $399,452 $552.811 $627.868 Total assets $552,811 $627,868 SMOLIRA GOLF CORP 2018 Income Statement Sales Cost of goods sold Depreciation Earnings before interest and taxes Interest paid Taxable income Taxes (255) Net income Dividends $25,000 Retained earnings 37.235 $506,454 359.328 44.463 $102,663 19,683 $ 82,980 20.745 $ 62.235 Page 4 of 5