To begin your assigment you gather the following financial data and ratios that are typical of companies in Lydex Company's industry You have just been hired as a financial analyst for Lydex Company, a manufacturer of safety helmets. Your boss has asked you to perform a comprehensive analysis of the company's financial statements, including comparing Lydex's performance to its major competitors. The company's financial statements for the last two years are as follows: 23 1.2 32 days 60 days 8.7% Last Year Current ratio Acid-test ratio Average collection period Average sale period Return on assets Debt-to-equity ratio Times interest eamed ratio Price-earnings ratio Lydex Company Comparative Balance Sheet This Year Assets Current assets: Cash $ 1,050,000 Marketable securities Accounts receivable, net 3,060,000 Inventory 3,400,000 Prepaid expenses 240,000 0.65 5.9 10 $ 1,360,000 300.000 2.160.000 2,400,000 220.000 Required: 1. Present the balance sheet in common-size format. (Round your percentage answers to 1 decimal place le., 0.123 is considered as 12.3. Due to rounding, figures may not fully reconcile down a column.) Total current assets Plant and equipment, net 7.750,000 9,700,000 6.440.000 9.140,000 Total assets $ 17,450,000 $15,580,000 Lydex Company Common-Size Balance Sheets This Year Last Year Assets Liabilities and Stockholders' Equity Liabilities Current liabilities Note payable, 10% Current assets $ 4,400,000 3,720,000 $3,160,000 3.120.000 Total liabilities 8,120,000 6,280,000 Stockholders' equity: Common stock, $70 par value Retained earnings 7,000,000 2.330,000 7,000,000 2.300.000 Cash Marketable securities Accounts receivable, net Inventory Prepaid expenses Total current assets Plant and equipment, net Total assets Liabilities and Stockholders' Equity 0.01 Total stockholders' equity 9,330,000 9,300,000 0.0% Total liabilities and stockholders' equity $ 17,450,000 $15,580,000 Liabilities: Lydex Company Comparative Income Statement and Reconciliation This Year Last Year Sales (all on account) $ 15,950,000 $ 14,480,000 Cost of goods sold 12.760,000 10,860,000 Current liabilities Note payable, 10% Total liabilities Stockholders' equity Common stock, S70 par value Retained earnings Total stockholders' equity Total liabilities and equity 00 Gross margin Selling and administrative expenses 3,190,000 2,018,000 3,620,000 1,640,000 0.0 0.0% 0.0% Net operating income Interest expense 1,172,000 372.000 1,980,000 312.000 Net income before taxes Income taxes (30%) 800,000 240,000 1,668,000 500.400 2. Present the income statement in common-size format down through net income. (Round your percentage answers to 1 decimal place l.e., 0.123 is considered as 12.3. Due to rounding, figures may not fully reconcile down a column.) Net income Common dividends 560,000 530,000 1,167,600 583,800 Net income retained Beginning retained earnings 583 800 1,716,200 30,000 2,300,000 $ 2,330,000 Last Year Ending retained earnings $2,300,000 Lydex Company Common-Size Income Statements This Year Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income Interest expense Net income before taxes Income taxes (30%) Net income