Return 3 Part 3 of 3 10 points You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company's financial statements, including comparing Lydex's performance to its major competitors. The company's financial statements for the last two years are as follows: Lydex Company Comparative Balance Sheet This Year Last Year Assets Current assets: Cash $ 880,000 $ 1,120,000 Marketable securities 0 300,000 Accounts receivable, net 2,380,000 1,480,000 Inventory 3,520,000 2,200,000 Prepaid expenses 240,000 180,000 Total current assets 7,020,000 5,280,000 Plant and equipment, net 9,360,000 8,970,000 Total assets $16,380,000 $14,250,000 Liabilities and Stockholders' Equity Liabilities: Current liabilities $ 3,930,000 $ 2,820,000 Note payable, 104 3,620,000 3,020,000 Total liabilities 7,550,000 5,840,000 Stockholders' equity: Common stock, $75 par value 7,500,000 7,500,000 Retained earnings 1,330,000 910,000 Total stockholders' equity 8,830,000 8,410,000 Total liabilities and stockholders' equity $16,380,000 $14,250,000 Part 3 of 3 10 points Lydex Company Comparative Income Statement and Reconciliation This Year Sales (all on account) Last Year $ 15,780,000 $12,780, eee Cost of goods sold 12,624,000 Gross margin 9,585,000 Selling and administrative expenses 3,156,000 3,195,000 1,794, 000 1,572,000 Net operating income 1,362,000 Interest expense 1,623,000 362,000 302, e90 Net income before taxes 1,000,000 1,321,600 Income taxes (301) 300,000 396, 300 Net income 700,000 924,700 Common dividends 280,000 462,350 Net income retained 420,000 462,350 Beginning retained earnings 910,000 447,650 Ending retained earnings $ 1,330,000 $ 910,000 To begin your assignment you gather the following financial data and ratios that are typical of companies in Lydex Company's industry Current ratio Acid-test ratio Average collection period Average sale period Return on assets Debt-to-equity ratio Times interest earned ratio Price-earnings ratio 2.3 1.0 30 days 60 days 8.49 0.7 5.7 10 15 Exercises Connect Check my work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion Help 3 Return 3 of 3 3. You decide, finally, to assess the company's liquidity and asset management. For both this year and last year, compute: a. Working capital b. The current ratio. (Round your final answers to 2 decimal places.) c. The acid-test ratio. (Round your final answers to 2 decimal places.) d. The average collection period. (The accounts receivable at the beginning of last year totaled $1590,000) (Use 365 days in a year. Round your intermediate calculations and final answer to 2 decimal place) e. The average sale period. (The inventory at the beginning of last year totaled $1.950,000) (Use 365 days in a year. Round your Intermediate calculations and final answer to 2 decimal place.) t The operating cycle. (Round your intermediate calculations and final answer to 2 decimal place.) 9. The total asset turnover (The total assets at the beginning of last year totaled $12.990,000) (Round your final answers to 2 decimal places.) ats Answer is not complete. This Year 3.090.000 1.80 0.30 Last Year 2.460.000 1.90 1.00 Working capital The current ratio The acid-test ratio The average collection period The average sale period The operating cycle The total asset burnover day e 441 days 82.00 days 127 33 days 1.03 1 79.02 days 122 86 days 089 19 MacBook Pro DD 80 3 5 F& A @ # 3 $ 4 % 5 & 7 8 6 9 2 0 0 W E R U Y T L K J S D F H G