27. 
    

    The financial manager of Company XYZ is reviewing the company's financial statements for the quarter ended September 30th, 20XX. From the income statement, it is observed that the company generated $900,000 in revenue and incurred $600,000 in expenses, resulting in a net income of $300,000. Additionally, the balance sheet shows total assets of $4,000,000, total liabilities of $1,500,000, and total stockholders' equity of $2,500,000.

    Requirements:

    • Compute the gross profit margin and net profit margin for Company XYZ.
    • Assess the liquidity position by calculating the current ratio and quick ratio.
    • Analyze the return on equity (ROE) for Company XYZ.
    • Provide recommendations for improving profitability and financial stability based on the analysis.