The financial statements of Zach industries for the year ended December 31, 2015 are:

Zach Industries Income Statement: for the Year Ended December, 31, 2012 Sales revenue $160,100 Less: Cost of goods sold 105,500 Gross profits $54,600 Less: Operating expenses Selling espense $16,500 General and administrative expenses 10,400 Lease expense 1,040 Depreciation expense 9,600 Total operating expense $37,540 Operating profits $17,060 Less: Interest expense 5,900 Net profits before taxes $11,160 Less: Taxes 4,400 Net profits after taxes $6,760

a. Use the financial statements to complete the following table for 2015. Assume the industry averages given in the table are applicable for 2014 and 2015.

Ratio Industry average Actual 2014 Actual 2015 (?) Current ratio 1.81 1.85 Quick ratio 0.71 0.79 Inventory turnover* 2.50 2.59 Average collection period* 38.6 days 37.6 days Debt ratio 64.5% 66.5% Times interest earned ratio 3.9 4.1 Gross profit margin 38% 40% Net profit margin 3.6% 3.7% Return on total assets 4.1% 4.1% Return on common equtiy 9.7% 8.2% Market/book ratio 1.7 1.8

b. Analyze Zach industries' financial condition as it is related to (1) liquitidy (2) activity (3) debt (4) profitability, and (5) market. Summarize the company's overall financial condition.