Requirement 1a. Compute the current ratios for

2016 and 2015.

Begin by selecting the formula to compute the current ratio.

Current ratio

=

Total current assets / Total current liabilities

Now, compute the current ratios for 2016 and 2015.

(Round your answers to two decimal places, X.XX.)

2016:

2015:

Lanfield, Inc.

Comparative Income Statement

Years Ended December 31, 2016 and 2015

2016

2015

Net Sales

$468,000

$423,000

Cost of Goods Sold

238,000

212,000

Gross Profit

230,000

211,000

Operating Expenses

136,000

134,000

Income From Operations

94,000

77,000

Interest Expense

11,000

14,000

Income Before Income Tax

83,000

63,000

Income Tax Expense

18,000

22,000

Net Income

$65,000

$41,000

Lanfield, Inc.

Comparative Balance Sheet

December 31, 2016 and 2015

2016

2015

2014*

Assets

Current Assets:

Cash

$98,000

$97,000

Accounts Receivables, Net

112,000

119,000

$106,000

Merchandise Inventory

147,000

162,000

202,000

Prepaid Expenses

12,000

7,000

Total Current Assets

369,000

385,000

Property, Plant, and Equipment, Net

219,000

176,000

Total Assets

$588,000

$561,000

$600,000

Liabilities

Total Current Liabilities

$226,000

$246,000

Long-term Liabilities

122,000

94,000

Total Liabilities

348,000

340,000

Stockholders' Equity

Preferred Stock, 4%

108,000

108,000

Common Stockholders' Equity, no par

132,000

113,000

94,000

Total Liabilities and Stockholders' Equity

$588,000

$561,000

* Selected 2014 amounts