Samoa Ltd. has the following financial statements and additional information as at December 31, 2023. Samoa Ltd. Comparative Statements of Financial Position December 31, 2023 and 2022 2023 2022 Cash $105,800 $65,000 Accounts receivable, net 70,000 52,800 Inventory 107,000 96,000 Prepaid expenses 4,200 5,200 Equipment 130,000 120,000 Acc. Depreciation - Equip. (28,000) (10,000) Total assets $389,000 $329,000 Accounts payable $26,000 $32,000 Wages payable 17,000 16,000 Income tax payable 2,600 3,400 Notes payable (long term) 60,000 90,000 Share capital 200,000 150,000 Retained earnings 83,400 37,600 Total liabilities & equity $389,000 $329,000 Samoa Ltd. Income Statement for the year ended December 31, 2023 Sales $850,000 Cost of goods sold 512,500 Gross profit $337,500 Interest expense (58,600) General administrative and selling expenses (67,000) Gain on sale of equipment 2,000 Profit before tax $213,900 Income tax expense Net profit (54,100) $159,800 4 2023-24 Semester 2 Principles of Accounting II Assignment 3 - - Question Paper Additional information: a. b. C. Cash dividends of $180,000 and $150,000 were declared and paid in 2022 and 2023 respectively. Weighted-average number of ordinary shares outstanding was 50,000 shares throughout 2022 and 2023. Year-end market prices of ordinary shares were $15 and $10 per share in 2022 and 2023 respectively. Required: Part A (14 marks) Using the financial statements and additional information, compute the following ratios. Show all computations. For 2023 1. Current ratio 2. Total asset turnover 3. Receivables turnover 4. Dividend yield 5. Price-earnings ratio 6. Times interest earned 7. Profit margin 8. Days' sales uncollected 9. Return on ordinary shareholders' equity 10. Debt to equity ratio For 2022 1. Current ratio 2. Dividend yield 3. Debt to equity ratio Part B (6 marks) In complete sentences, comment on your observation of the change of the debt-to-equity ratios between 2022 and 2023. Think carefully about the positive or negative effects on the company's financial position and performance. (Total 20 marks)