The financial statements of Sol Company appear below:

Sol COMPANY

Comparative Statements of Financial Position

December 31, 2017

Assets 2017 2016

Property, plant and equipment (net).................................................. $260,000 $300,000

Inventory............................................................................................ 50,000 70,000

Accounts receivable (net).................................................................. 50,000 30,000

Short-term investments..................................................................... 15,000 60,000

Cash................................................................................................... 25,000 40,000

Total assets ................................................................................ $400,000 $500,000

Equity and liabilities

Share capital ordinary.................................................................... $150,000 $150,000

Retained earnings.............................................................................. 110,000 70,000

Bonds payable................................................................................... 80,000 160,000

Accounts payable.............................................................................. 20,000 30,000

Short-term notes payable.................................................................. 40,000 90,000

Total equity and liabilities ........................................................... $400,000 $500,000

GROGAN COMPANY

Income Statement

For the Year Ended December 31, 2017

Net sales............................................................................................ $400,000

Cost of goods sold............................................................................. 240,000

Gross profit........................................................................................ 160,000

Operating expenses........................................................................... 42,000

Income from operations..................................................................... 118,000

Interest expense................................................................................ 18,000

Income before income taxes............................................................. 100,000

Income tax expense.......................................................................... 30,000

Net income........................................................................................ $ 70,000

Additional information:

a. Cash dividends of $23,000 were declared and paid in 2017.

b. Weighted-average number of ordinary shares outstanding during 2017 was 30,000 shares.

c. Market value of ordinary shares on December 31, 2017, was $21 per share.

Instructions

Using the financial statements and additional information, compute the following ratios for Grogan Company for 2017. Show all computations.

1. Current ratio _________.

2. Return on ordinary shareholders' equity _________.

3. Price-earnings ratio _________.

4. Acid-test ratio _________.

5. Accounts receivable turnover _________.

6. Times interest earned _________.

7. Profit margin _________.

8. Days in inventory _________.

9. Payout ratio _________.

10. Return on assets _________.