Severyn Properties declared and paid $$3,600$ of cash dividends during the current year ended December $31.$ Its financial statements also reported the following summarized data:

Current Previous

Income Statement

Sales revenue $ $210,000$ $ $189,000$

Cost of goods sold $122,000112,000$

Gross profit $88,00077,000$

Operating expenses $59,30055,200$

Interest expense $3,3003,200$

Income before income taxes $25,40018,600$

Income tax expense $7,6203,600$

Net income $ $17,780$ $ $15,000$

Balance Sheet

Cash $ $4,680$ $ $8,600$

Accounts receivable $($net$)25,00026,000$

Inventory $46,00041,000$

Property and equipment $($net$)51,00044,000$

Total assets $ $126,680$ $ $119,600$

Current liabilities $ $15,500$ $ $23,200$

Notes payable $($long$-$term$)51,00051,000$

Common stock $($par $$5)33,60033,600$

Additional paid$-$in capital $6,2005,600$

Retained earnings $20,3806,200$

Total liabilities and stockholders$$ equity $ $126,680$ $ $119,600$

Required:

Compute the gross profit percentage for the current and previous years. Are the current$-$year results better, or worse, than those for the previous year?

Compute the net profit margin for the current and previous years. Are the current$-$year results better, or worse, than those for the previous year?

Compute the earnings per share for the current and previous years. Are the current$-$year results better, or worse, than those for the previous year? TIP: To calculate EPS, use the balance in Common Stock to determine the number of shares outstanding. Common Stock equals the par value per share times the number of shares.

Stockholders$$ equity totaled $$33,600$ at the beginning of the previous year. Compute the return on equity $($ROE$)$ ratios for the current and previous years. Are the current$-$year results better, or worse, than those for the previous year?

Net property and equipment totaled $$38,000$ at the beginning of the previous year. Compute the fixed asset turnover ratios for the current and previous years. Are the current$-$year results better, or worse, than those for the previous year?

Compute the debt$-$to$-$assets ratios for the current and previous years. Is debt providing financing for a larger or smaller proportion of the company$$s asset growth?

Compute the times interest earned ratios for the current and previous years. Are the current$-$year results better, or worse, than those for the previous year?

After Severyn released its current year$$s financial statements, the company$$s stock was trading at $$36.$ After the release of its previous year$$s financial statements, the company$$s stock price was $$27$ per share. Compute the P$/$E ratios for both years. Does it appear that investors have become more $($or less$)$ optimistic about Severyn$$s future success?