The companies are in the same line of business and are direct competitors in a large metropolitan area. Both have been in business approximately 10 years and each has had steady growth. Despite these similarities, the management of each has a different viewpoint in many respects. Blair is more conservative, and as its president said, We avoid what we consider to be undue risk. Both companies use straight-line depreciation, but Blair estimates slightly shorter useful lives than Armstrong. No shares were issued in the current year and neither company is publicly held. Blair Company has an annual audit by a CPA, but Armstrong Company does not. Assume the end-of-year total assets and net equipment balances approximate the years average and all sales are on account.

Required:

1. Calculate the following ratios. TIP: To calculate EPS, use the balance in Common Stock to determine the number of shares outstanding. Common Stock equals the par value per share times the number of shares. (Use 365 days in a year. Do not round intermediate calculations and round your final answers to 2 decimal places.)

Blair Armstrong Company Company Balance Sheet $ 20,000 $33,000 38,000 96,000 176,000 43,000 $386,000 Cash Accounts Receivable, Net 28,000 36,000 296,000 Inventory Equipment, Net 406,000 $786,000 $ 46,000 Other Assets Total Assets Current Liabilities $96,000 Note Payable (long-term) 56,000 152,000 148,000 28,000 58,000 $386,000 366,000 412,000 198,000 108,000 Total Liabilities Common Stock (par $10) Additional Paid-in Capital Retained Earnings 68,000 $786,000 Total Liabilities and Stockholders' Equity Income Statement Sales Revenue $444,000 243,000 158,000 $ 43,000 $804,000 403,000 313,000 $ 88,000 Cost of Goods Sold Other Expenses Net Income Other Data Estimated value of each share at end of year Selected Data from Previous Year 18 27 Accounts Receivable, Net 18,000 90,000 176,000 56,000 229,000 $36,000 43,000 296,000 68,000 438,000 Inventory Equipment, Net Note Payable (long-term) Total Stockholders' Equity Armstrong Company Blair Ratio Company Tests of Profitability: 1.Net Profit Margin % % % 2. Gross Profit Percentage 3. Fixed Asset Turnover 4 Return on Equity 5. Earnings per Share 6 Price/Earnings Ratio Tests of Liquidity: % % 7. Receivables Turnover Days to Collect Inventory Turnover Days to Sell 9 Current Ratio Tests of Solvency: 10. Debt-to-Assets