Interest is Big Valley's only fixed cash charge. Big Valley's market value of equity to book value of debt ratio 1.5. 1.35 0.5 50 Peer Average Ratios Current Ratio Quick Ratio Days Sales in Receivables Sales to Working Capital Sales to Fixed Assets Times Interest Earned Debt to Asset Ratio Return on equity 14 1.8 4 50% 15% Altman's Z-score model is Z = 1.2X1 + 1.4X2 + 3.3X3 + 0.6X4 + 1.0Xs. X1 = Working Capital/Total Assets X2 = Retained Earnings/Total Assets X3 = EBIT/Total Assets X4 = Market Value Equity/Book Value Long-Term Debt X5 = Sales/Total Assets Interest is Big Valley's only fixed cash charge. Big Valley's market value of equity to book value of debt ratio 1.5. 1.35 0.5 50 Peer Average Ratios Current Ratio Quick Ratio Days Sales in Receivables Sales to Working Capital Sales to Fixed Assets Times Interest Earned Debt to Asset Ratio Return on equity 14 1.8 4 50% 15% Altman's Z-score model is Z = 1.2X1 + 1.4X2 + 3.3X3 + 0.6X4 + 1.0Xs. X1 = Working Capital/Total Assets X2 = Retained Earnings/Total Assets X3 = EBIT/Total Assets X4 = Market Value Equity/Book Value Long-Term Debt X5 = Sales/Total Assets