The comparative financial statements prepared at December 31 for Golden Corporation showed the following summarized data:

	Current			Previous
Income Statement
Sales revenue	$	200,000		$	181,000
Cost of goods sold		118,000			108,000
Gross profit		82,000			73,000
Operating expenses		57,300			53,600
Interest expense		3,100			3,000
Income before income taxes		21,600			16,400
Income tax expense		6,480			3,400
Net income	$	15,120		$	13,000
Balance Sheet
Cash	$	7,520		$	8,400
Accounts receivable (net)		23,000			25,000
Inventory		44,000			39,000
Property and equipment (net)		49,000			42,000
	$	123,520		$	114,400
Current liabilities	$	18,800		$	21,800
Note payable (long-term)		49,000			49,000
Common stock (par $5)		32,400			32,400
Additional paid-in capital		5,800			5,400
Retained earnings*		17,520			5,800
	$	123,520		$	114,400

*During the current year, cash dividends of $3,400 were declared and paid.

Required:

1-a.	Compute the gross profit percentage for the current and previous years. (Round your answers to 1 decimal place.)

1-b.

Are the current year results better, or worse, than those for the previous year?

	Better
	Worse

2-a.	Compute the net profit margin for the current and previous years. (Round your answers to 1 decimal place.)

2-b.

Are the current year results better, or worse, than those for the previous year?

	Better
	Worse

3-a.	Compute the earnings per share for the current and previous years.
	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. (Round your answers to 2 decimal places.)

3-b.

Are the current year results better, or worse, than those for the previous year?

	Better
	Worse

4-a.	Stockholders equity totaled $32,400 at the beginning of the previous year. Compute the return on equity (ROE) ratios for the current and previous years. (Round your answers to 1 decimal place.)

4-b.

Are the current year results better, or worse, than those for the previous year?

	Better
	Worse

5-a.	Net property and equipment totaled $37,000 at the beginning of the previous year. Compute the fixed asset turnover ratios for the current and previous years. (Round your answers to 2 decimal places.)

5-b.

Are the current year results better, or worse, than those for the previous year?

	Better
	Worse

6-a.	Compute the debt-to-assets ratios for the current and previous years. (Round your answers to 2 decimal places.)

6-b.

Is debt providing financing for a larger or smaller proportion of the companys asset growth?

	Larger Proportion
	Smaller Proportion

7-a.	Compute the times interest earned ratios for the current and previous years. (Round your answers to 1 decimal place.)

7-b.

Are the current year results better, or worse, than those for the previous year?

	Better
	Worse

8-a.	After Golden released its current years financial statements, the companys stock was trading at $34. After the release of its previous years financial statements, the companys stock price was $25 per share. Compute the P/E ratios for both years. (Round your intermediate calculations and final answers to 2 decimal places.)

8-b.

Does it appear that investors have become more (or less) optimistic about Goldens future success?

	More Optimistic
	Less Optimistic