The following ratios have been computed for Al-Aqsa company for 2012 Profit Margin = 20% Times interest earned = 9 times Receivables turnover = 3 Times Acid test ratio = 21 Current ratio = 3:1 Debt to total assets ratio = 20% For 2011 Cash = 450,000 Marketable Securities = 25,000, A/R (net) = 40,000 Inventory = 50,000 Fixed assets (net) = 160,000, Total assets = 320,000 Account payable = 30,000 , Short term notes payable = 35,000 Bonds payable = 20,000 , Common stock = 200,000 Retained earnings = 35,000 Total liabilities and Equity = 320,000 For 2012 Cash = 30,000, Marketable Securities = 10,000, A/R (net) = A, Inventory = 8 Fixed Assets = 200,000 Total Assets = K A/P = C Short term notes payable = 400,000, Bonds payable = D. Common stock = 220,000 Retained earnings = 60,000 Total liabilities and equity = L Items of income statement for December 31,2012 Net Sales = 150,000 Cost of goods sold = 75,000 Depreciation expense - E, Interest Expense = 5000, Selling Expenses = 8000, Administrative expenses = 12000, Total operating expenses = F, Income before Taxes = G, Income Tax expense =H Net income = 1 * = Income before income taxes (G.6 (3 ) 35,000 40,000 30,000 45,000 The following ratios have been computed for Al-Aqsa company for 2012 Profit Margin = 20% Times interest earned = 9 times Receivables turnover = 3 Times Acid test ratio = 21 Current ratio = 3:1 Debt to total assets ratio = 20% For 2011 Cash = 450,000 Marketable Securities = 25,000, A/R (net) = 40,000 Inventory = 50,000 Fixed assets (net) = 160,000, Total assets = 320,000 Account payable = 30,000 , Short term notes payable = 35,000 Bonds payable = 20,000 , Common stock = 200,000 Retained earnings = 35,000 Total liabilities and Equity = 320,000 For 2012 Cash = 30,000, Marketable Securities = 10,000, A/R (net) = A, Inventory = 8 Fixed Assets = 200,000 Total Assets = K A/P = C Short term notes payable = 400,000, Bonds payable = D. Common stock = 220,000 Retained earnings = 60,000 Total liabilities and equity = L Items of income statement for December 31,2012 Net Sales = 150,000 Cost of goods sold = 75,000 Depreciation expense - E, Interest Expense = 5000, Selling Expenses = 8000, Administrative expenses = 12000, Total operating expenses = F, Income before Taxes = G, Income Tax expense =H Net income = 1 * = Income before income taxes (G.6 (3 ) 35,000 40,000 30,000 45,000