Question 3 The following financial information is for Crane Company CRANE COMPANY Balance Sheets December 31 2017 Assets Cash Debt investments (short-term) Accounts receivable Inventory Prepaid expenses Land Building and equipment (net) Total assets Liabilities and Stockholders' Equity Notes payable Accounts payable Accrued liabilities Bonds payable, due 2020 Common stock, $10 par Retained earnings Total liabilities and stockholders' equity 2016 $ 69,000 69,000 39,000 90,000 230,000168,000 26,000 129,000 129,000 262,000 183,000 $870,000 $704,000 51,000 105,000 24,000 $171,000 $109,000 52,000 40,000 252,000 172,000 205,000205,000 136,000 126,000 $704,000 66,000 40,000 $870,000 CRANE COMPANY Income Statements For the Years Ended December 31 2017 2016 Sales revenue Cost of goods sold Gross profit Operating expenses Net income $893,000 $782,000 575,000 648,000 245,000 207,000 195,000 $50,000 $46,000 161,000 Additional information 1. Inventory at the beginning of 2016 was $116,000. 2. Accounts receivable (net) at the beginning of 2016 were $88,000 3. Total assets at the beginning of 2016 were $636,000. No common stock transactions occurred during 2016 or 2017. 5. All sales were on account. (al) Your answer is partially correct. Try again Compute the liquidity and profitability ratios of Crane Company for 2016 and 2017. (Round current ratio and asset turnover to 2 decimal places, e.g 1.83 an 1.8 or 1.8%. If 96 change is a decrease show the numbers as negative, e.g.-1.8396 or (1.8396).) 2017 2016 % Change LIQUIDITY Current ratio 1.64:1 9.16 times 3.26 times 1.95 :1 (15.90) Accounts receivables turnover 8.79 times 4.21 Inventory turnover 4.05 times (19.51) 2017 2016 % change PROFITABILITY Profit margin (4.76) (3.42) (7.57) 5.881 % Asset turnover 13 times 6.351 % 2.44 1.17 times Return on assets 6.871 % Earnings per share 2.44 8.93