Problem 4.15 (Return on Equity and Quick Ratio) eBook Problem Walk-Through loyd Inc. has sales of $100,000, a net income of $5,000, and the following balance sheet: Question 8 of 11 Check My Work (2 remaining) Cash Receivables Inventories Total current assets Net fixed assets Total assets $ 20,250 Accounts payable 36,500 Notes payable to bank 122,500 Total current liabilities $179,250 Long-term debt 70,750 Common equity $250,000 Total liabilities and equity $ 23,500 11,750 $ 35,250 32,500 182,250 $250,000 The new owner thinks that inventories are excessive and can be lowered to the point where the current ratio is equal to the industry average, 2x, without affecting sales or net income. If inventories are sold and not replaced (thus educing the current ratio to 2), if the funds generated are used to reduce common equity (stock can be repurchased at book value), and if no other changes occur, by how much will the ROE change? Do not round intermediate alculations. Round your answer to two decimal places. COE will -Select- by percentage points. What will be the firm's new quick ratio? Do not round intermediate calculations. Round your answer to two decimal places. Icon Key Problem 4.15 (Return on Equity and Quick Ratio) Check My Work (2 remaining) 4Question 8 of 11