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The 2020 financial statements of Outdoor Waterworks Inc. follow: Outdoor Waterworks Inc. Income Statement For Year Ended December 31, 2020 Net sales $ 986,000 Cost

The 2020 financial statements of Outdoor Waterworks Inc. follow:

Outdoor Waterworks Inc.
Income Statement
For Year Ended December 31, 2020
Net sales $ 986,000
Cost of goods sold:
Inventory, Dec. 31, 2019 $ 76,360
Purchases 602,840
Goods available for sale $ 679,200
Inventory, Dec. 31, 2020 59,340
Cost of goods sold 619,860
Gross profit from sales $ 366,140
Operating expenses 275,360
Operating profit $ 90,780
Interest expense 11,600
Profit before taxes $ 79,180
Income taxes 18,964
Profit $ 60,216

Outdoor Waterworks Inc.
Balance Sheet
December 31, 2020
Assets
Cash $ 22,400
Current non-strategic investments 24,720
Accounts receivable, net 52,280
Notes receivable 10,760
Inventory 59,340
Prepaid expenses 5,800
Plant and equipment, net 327,520
Total assets $ 502,820
Liabilities and Equity
Accounts payable $ 48,920
Accrued wages payable 6,280
Income taxes payable 7,020
Long-term note payable, secured by mortgage on plant 114,600
Common shares, 160,000 shares 193,000
Retained earnings 133,000
Total liabilities and equity $ 502,820

Assume all sales were on credit. Also assume the long-term note payable is due in 2023, with no current portion. On the December 31, 2019, balance sheet, the assets totalled $433,720, common shares were $193,000, and retained earnings were $108,240. Required: Calculate the following: (Use 365 days in a year. Do not round your intermediate calculations. Round the answers to 2 decimal places.)

Analysis Component: Identify whether the ratios calculated above are favourable or unfavourable to the industry averages.

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