The 2020 financial statements of Outdoor Waterworks Inc. follow:

Outdoor Waterworks Inc.
Income Statement
For Year Ended December 31, 2020
Net sales	$	1,126,000
Cost of goods sold:
Inventory, Dec. 31, 2019	$	83,360
Purchases		616,840
Goods available for sale	$	700,200
Inventory, Dec. 31, 2020		61,440
Cost of goods sold		638,760
Gross profit from sales	$	487,240
Operating expenses		289,360
Operating profit	$	197,880
Interest expense		13,000
Profit before taxes	$	184,880
Income taxes		19,664
Profit	$	165,216

Outdoor Waterworks Inc.
Balance Sheet
December 31, 2020
Assets
Cash	$	23,800
Current non-strategic investments		26,400
Accounts receivable, net		53,680
Notes receivable		12,160
Inventory		61,440
Prepaid expenses		6,080
Plant and equipment, net		334,520
Total assets	$	518,080
Liabilities and Equity
Accounts payable	$	49,480
Accrued wages payable		6,560
Income taxes payable		7,440
Long-term note payable, secured by mortgage on plant		118,800
Common shares, 160,000 shares		200,000
Retained earnings		135,800
Total liabilities and equity	$	518,080

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 $440,720, common shares were $200,000, and retained earnings were $112,440. Required: Calculate the following: (Use 365 days in a year. Do not round your intermediate calculations. Round the answers to 2 decimal places.)

a.	Current ratio		to 1
b.	Quick ratio		to 1
c.	Days sales uncollected		days
d.	Inventory turnover		times
e.	Days sales in inventory		days
f.	Ratio of pledged plant assets to secured liabilities		to 1
g.	Times interest earned		times
h.	Profit margin		%
i.	Total asset turnover		times
j.	Return on total assets		%
k.	Return on common shareholders equity		%

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

		Industry Average
a.	Current ratio	1.6:1
b.	Quick ratio	1.1:1
c.	Days sales uncollected	21	days
d.	Inventory turnover	5	times
e.	Days sales in inventory	70	days
f.	Ratio of pledged plant assets to secured liabilities	1.4:1
g.	Times interest earned	50	times
h.	Profit margin	14	%
i.	Total asset turnover	2.3	times
j.	Return on total assets	20	%
k.	Return on common shareholders equity	32.7	%

Unfavourable