Required information [The following information applies to the questions displayed below.] Income statements and balance sheets data for Virtual Gaming Systems are provided below. VIRTUAL GAMING SYSTEMS Income Statements For the years ended December 31 2022 2021 Net sales $3,535 , $3,61, Cost of goods sold 2,485, eee 1,955, eee Gross profit 1,5 , 1,106,000 Expenses: Operating expenses 960, eee 863,000 Depreciation expense 35,000 29,500 Loss on sale of land 8,500 Interest expense 20,500 17,500 Income tax expense 8,500 50,500 Total expenses 1,024,000 969,000 Net income $ 26,800 $ 137,000 CH VIRTUAL GAMING SYSTEMS Balance Sheets December 31 2022 2021 2e2e $ 288,500 $191, eee 82,500 86,000 132,500 119, eee 14,5ee 12,500 $149, eee 65, 140, eee 6,600 Assets Current assets: Cash Accounts receivable Inventory Prepaid rent Long-term assets: Investment in bonds Land Equipment Less: Accumulated depreciation Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Interest payable Income tax payable Long-term liabilities: Notes payable Stockholders' equity: Common stock Retained earnings Total liabilities and stockholders' equity 11 , 11 , 35 , 215, eee 245, eee 305,000 275,000 215,000 (111,580) (76,500 (47,000) $1,046,500 $923, eee $773,600 $ 147,000 $ 71,000 $125, 100 10,500 7,000 3,500 12,500 17,500 14,580 450,000 290,000 230,000 305, eee 385 , 305,000 121,500 232,500 95,500 $1,046,500 $923,000 $773,600 Required: 1. Calculate the following risk ratios for 2021 and 2022: (Round your answers to 1 decimal plac Receivables turnover ratio Inventory turnover ratio Current ratio Debt to equity ratio 2021 40.5 times 15.6 times 4.2 to 1 1.01% 2022 42.0 times 20.5 times 2.6 to 1 3.6% 2. Calculate the following profitability ratios for 2021 and 2022: (Round your answers to 1 decimal place. S Gross profit ratio Return on assets Profit margin Asset turnover 2021 35.0 % 14.8% 3.9% 2022 28.61% 0.5% 0.1% 3.7 times 3.8 times