Table 3.2 Actual 2013 Dana Dairy Products Key Ratios Industry Actual Average 2012 Current ratio 1.3 1.0 Quick ratio 0.8 0.75 Average collection period 23 days 30 days Inventory turnover 21.7 19 Debt ratio 64.7% 50% Times interest earned 4.8 5.5 Gross profit margin 13.6% 12.0% Net profit margin 1.0% 0.5% Return on total assets 2.9% 2.0% Return on equity 8.2% 4.0% Income Statement Dana Dairy Products For the Year Ended December 31, 2013 Sales revenue $100,000 Less: Cost of goods sold 87,000 Gross profits $ 13,000 Less: Operating expenses 11,000 Operating profits $ 2,000 Less: Interest expense 500 Net profits before taxes $ 1,500 Less: Taxes (40%) 600 Net profits after taxes $ 900 $1.000 8.900 Balance Sheet Dana Dairy Products December 31, 2013 Assets Cash Accounts receivable Inventories Total current mets Groes fixed at $35.000 Less Accumulated depreciation 12.750 Net fixed as Total amet $14,250 21.750 $36,000 Liabilities & Stockholders Equity Accounts payable Accruals Total current liabilities Long-term debt Total liabilities Common stock Retained eaming Total stockholders' equity Total liabilities de stockholders equity $9,000 6675 $15,675 4125 $19,800 1,000 15200 $15,200 $36,000 (See Table 3.2) The debt ratio for Dana Dairy Products in 2013 was 55 percent 44 percent 11 percent 50 percent