ratio A firm has been experiencing low profitability in recent years. Perform an analysis of the firm's financial position using the DuPont equation. The firm has no lease payments but has a $3 million sinking fund payment on its debt. The most recent industry average ratios and the firm's financial statements are as follows: Industry Average Ratios Current ratio 3x Fixed assets 6 x turnover Debt-to-capital 20% Total assets 3x turnover Times interest 7x Profit margin 3.50% earned EBITDA 7x Return on total 10.50% coverage assets Inventory 9x Return on 15.00% turnover common equity Days sales 18 days Return on 13.20% outstanding invested capital a calculation is based on a 365-day year. Balance Sheet as of December 31, 2019 (Millions of Dollars) Cash and $ 83 Accounts payable $ 37 equivalents Accounts receivables 55 Other current 18 liabilities Inventories 184 Notes payable 51 Total current $ 322 Total current $ 106 assets liabilities Long-term debt 32 Total liabilities $ 138 Gross fixed assets 235 Common stock 106 Less depreciation 97 Retained earnings 216 Net fixed assets $ 138 Total stockholders' $ 322 equity Total assets $ 460 Total liabilities and $ 460 equity ho Income Statement for Year Ended December 31, 2019 (Millions of Dollars) Net sales $ 765.00 Cost of goods sold 640.00 Gross profit $ 125.00 Selling expenses 68.50 EBITDA $ 56.50 Depreciation expense 12.00 Earnings before interest and taxes (EBIT) $ 44.50 Interest expense 4.50 Earnings before taxes (EBT) 40.00 Taxes (25%) 10.00 Net income 30.00 a. Calculate the following ratios. Do not round intermediate calculations. Round your answers to two decimal places. Firm Industry Average Current ratio 3.04 x 3x Debt to total capital 0.3 % 20% Times interest 7x earned EBITDA coverage 12.6 x 7x Inventory turnover 3.48 x 9x Days sales days 18 days outstanding Fixed assets x 6 x turnover Total assets xx 3 x turnover % 3.50% Return on total X % 10.50% assets Return on common X% 15.00% equity Return on invested % 13.20 % capital b. Construct a DuPont equation for the firm and the industry. Do not round intermediate calculations. Round your answers to two decimal places. Firm Industry Profit margin % 3.50% 9.88 Ox Profit margin Total assets Xx 3 x turnover Equity multiplier x x