The balance sheet and income statement for Webb Enterprises Inc. are found below:

Balance Sheet	2015
Cash and marketable securities	$500
Accounts receivable	6,000
Inventories	9,500
Current assets	$16,000
Net property, plant, and equipment	17,000
Total	$33,000
Accounts payable	$7,200
Short-term debt	6,800
Current liabilities	$14,000
Long-term debt	7,000
Total liabilities	$21,000
Total owners' equity	12,000
Total liabilities and owners' equity	$33,000

Income Statement	2015
Revenues	$30,000
Cost of goods sold	(20,000)
Gross profit	$10,000
Operating expenses	(8,000)
Net operating income	2,000
Interest expense	(900)
Earnings before taxes	$1,100
Taxes	(400)
Net income	$700

a. Prepare a common size balance sheet for Webb Enterprises.

b. Prepare a common size income statement for Webb Enterprises.

c. Use your common size financial statements to respond to your boss' request that you write an assessment of the firm's financial condition. Specifically, write a brief narrative that responds to the following questions:

1. How much cash does Webb have on hand relative to its total assets?

2. What proportion of Webb's assets has the firm financed using short-term debt? Long-term debt?

3. What percentage of Webb's revenues does the firm have left over after paying all of its expenses (including taxes)?

4. Describe the relative importance of Webb's major expense categories, including cost of goods sold, operating expenses, and interest expenses.