The financial statements for Royale and Cavalier companies are summarized here:

	Royale Company				Cavalier Company
Balance Sheet
Cash	$	25,000			$	45,000
Accounts Receivable, Net		55,000				16,000
Inventory		110,000				25,000
Equipment, Net		550,000				160,000
Other Assets		140,000				46,000
Total Assets	$	880,000			$	292,000
Current Liabilities	$	120,000			$	15,000
Note Payable (long-term)		190,000				55,000
Common Stock (par $20)		480,000				210,000
Additional Paid-In Capital		50,000				4,000
Retained Earnings		40,000				8,000
Total Liabilities and Stockholders Equity	$	880,000			$	292,000
Income Statement
Sales Revenue	$	800,000			$	280,000
Cost of Goods Sold		480,000				150,000
Other Expenses		240,000				95,000
Net Income	$	80,000			$	35,000
Other Data
Per share price at end of year	$	14.00			$	11.00
Selected Data from Previous Year
Accounts Receivable, Net	$	47,000			$	14,000
Note Payable (long-term)		190,000				55,000
Equipment, Net		550,000				160,000
Inventory		95,000				38,000
Total Stockholders' Equity		570,000				202,000

These two companies are in the same business and state but different cities. Each company has been in operation for about 10 years. Both companies received an unqualified audit opinion on the financial statements. Royale Company wants to borrow $75,000 cash and Cavalier Company is asking for $30,000. The loans will be for a two-year period. Both companies estimate bad debts based on an aging analysis, but Cavalier has estimated slightly higher uncollectible rates than Royale. Neither company issued stock in the current year. Assume the end-of-year total assets and net equipment balances approximate the years average and all sales are on account.

Calculate the following ratios. (Use 365 days in a year. Round your intermediate calculations and final answers to 2 decimal places.)

Ratio Royale Company Cavalier

Test of Profitability

Net Profit Margin___________________%___________________%

Gross Profit Percentage_____________%____________________%

Fixed Asset Turnover_______________________________________

Retun on Equity___________________%______________________%

Earnings per Share____________________________________________

Price/earnings Ratio____________________________________________

Test of Liquidity

Receivables Turnover____________________________________________

Day to collect ___________________________________________________

Inventory Turnover________________________________________________

Days to Sell______________________________________________________

Current Ration_____________________________________________________

Test Of Solvency

Debt-To Assets______________________________________________________