The Corrigan Corporation$$s $2018$ and $2019$ financial statements follow, along with some industry average ratios. Corrigan is exempt from the interest deduction limitation because its average gross revenues for the prior $3$ years was less than $$25$ million. So $100\%$ of its interest expense is deductible. Industry Financial Ratios ${?}^a$

${?}^2$ Industry average ratios have been constant for the past $4$ years.

bBased on year$-$end balance sheet figures.

$$ Calculation is based on a $365-$day year.

${?}^d$ Measured as $($Short$-$term debt $+$ Long$-$term debt$)/($Short$-$term debt $+$ Long$-$term debt $+$

Common equity$)$

a$.$ Assess Corrigan$$s liquidity position, and determine how it compares with peers and how the liquidity position has changed over time.

b$.$ Assess Corrigan$$s asset management position, and determine how it compares with peers and how its asset management efficiency has changed over time.

c$.$ Assess Corrigan$$s debt management position, and determine how it compares with peers and how its debt management has changed over time.

d$.$ Assess Corrigan$$s profitability ratios, and determine how they compare with peers and how its profitability position has changed over time.

e$.$ Assess Corrigan$$s market value ratios, and determine how its valuation compares with peers and how it has changed over time. Assume the firm$$s debt is priced at par, so the market value of its debt equals its book value.

f$.$ Calculate Corrigan$$s ROE as well as the industry average ROE, using the DuPont equation. From this analysis, how does Corrigan$$s financial position compare with the industry average numbers?

g$.$ What do you think would happen to its ratios if the company initiated cost$-$cutting measures that allowed it to hold lower levels of inventory and substantially decreased the cost of goods sold? No calculations are necessary. Think about which ratios would be affected by changes in these two accounts.

Corrigan Corporation: Balance Sheets as of December $31$

Corrigan Corporation: Income Statements for Years Ending December $31$