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Question 1 Pharoah Medical manufactures hospital beds and other institutional furniture. The company's comparative balance sheet and income statement for 2015 and 2016 follow. Pharoah Medical Comparative Balance Sheet As of December 31 2016 2015 Assets Current assets Cash Accounts receivable, net Inventory Other current assets $387,000 1,075,000 727,000 381,350 2,570,350 8,651,835 $11,222,185 $417,400 776,500 681,100 247,050 2,122,050 8,439,645 $10,561,695 Total current assets Property, plant, & equipment, net Total assets Liabilities and Stockholders' Equity Current liabilities Long-term debt $3,162,000 3,702,600 6,864,600 Total liabilities Preferred stock, $5 par value Common stock, $0.25 par value Retained earnings Total stockholders' equity 58,950 104,650 4,193,985 $2,846,000 3,892,600 6,738,600 58,900 103,900 3,660,295 3,823,095 $10,561,695 4,357,585 Total liabilities and stockholders' equity $11,222,185 Pharoah Medical Comparative Income Statement and Statement of Retained Earnings For the Year 2016 2015 Sales revenue (all on account) Cost of goods sold Gross profit Operating expenses Net operating income Interest expense $10,177,300 5,613,000 4,564,300 2,840,300 1,724,000 300,300 1,423,700 427,110 $996,590 $9,613,900 5,298,700 4,315,200 2,634,200 1,681,000 308,650 1,372,350 411,705 $960,645 Net income before taxes Income taxes (30%) Net income Dividends paid Preferred dividends Common dividends Total dividends paid 29,500 433,400 462,900 533,690 3,660,295 $4,193,985 29,550 413,100 442,650 517,995 3,142,300 $3,660,295 Net income retained Retained earnings, beginning of year Retained earnings, end of year (a-d) * Your answer is incorrect. Try again. Calculate the following liquidity ratios for 2016. (If working capital is negative then enter with a negative sign preceding the number or parentheses, e.g. -15,000 or (15,000). Round all answers except working capital to 2 decimal places, e.g. 2.55.) a. Working capital b. Current ratio OTTO c. Acid-test ratio d. Accounts receivable turnover times Click if you would like to Show Work for this question: Open Show Work LINK TO TEXT LINK TO VIDEO Attempts: 1 of 3 used