Tiger Audio declared and paid a cash dividend of $6,525 in the current year. Its comparative financial statements, prepared at December 31, reported the following summarized information:

	Current				Previous
Income Statement
Sales Revenue	$	272,000			$	225,000
Cost of Goods Sold		147,650				131,000
Gross Profit		124,350				94,000
Operating Expenses		49,600				41,730
Interest Expense		5,000				4,270
Income before Income Tax Expense		69,750				48,000
Income Tax Expense (30%)		20,925				14,400
Net Income	$	48,825			$	33,600
Balance Sheet
Cash	$	53,550			$	41,000
Accounts Receivable, Net		24,500				21,000
Inventory		35,000				32,000
Property and Equipment, Net		137,000				127,000
Total Assets	$	250,050			$	221,000
Accounts Payable	$	32,000			$	30,000
Income Tax Payable		3,750				3,300
Note Payable (long-term)		86,500				102,200
Total Liabilities		122,250				135,500
Common Stock (par $1)		31,000				31,000
Retained Earnings		96,800				54,500
Total Liabilities and Stockholders Equity	$	250,050			$	221,000

Required:

1. Compute the gross profit percentage in the current and previous years. Are the current year results better, or worse, than those for the previous year?

2. Compute the net profit margin for the current and previous years. Are the current year results better, or worse, than those for the previous year?

3. Compute the earnings per share for the current and previous years. Are the current year results better, or worse, than those for the previous year?

4. Stockholders equity totaled $75,000 at the beginning of the previous year. Compute the return on equity ratios for the current and previous years. Are the current year results better, or worse, than those for the previous year?

5. Net property and equipment totaled $125,000 at the beginning of the previous year. Compute the fixed asset turnover ratios for the current and previous years. Are the current year results better, or worse, than those for the previous year?

6. Compute the debt-to-assets ratios for the current and previous years. Is debt providing financing for a larger or smaller proportion of the companys asset growth?

7. Compute the times interest earned ratios for the current and previous years. Are the current year results better, or worse, than those for the previous year?

8. After Tiger released its current year financial statements, the companys stock was trading at $20. After the release of its previous year financial statements, the companys stock price was $12 per share. Compute the P/E ratios for both years. Does it appear that investors have become more (or less) optimistic about Tigers future success?