Use the balance sheets and other information provided, calculate the ratios identified below.

Hokie Corporation Comparative Balance Sheet

For the Years Ending December 31,2012 and 2013

(Millions of Dollars)

Assets 2012 2013

Current Assets:

Cash $ 2 $ 10

Accounts Receivable 16 10

Inventory 22 26

Total Current Assets $ 40 $ 46

Gross Fixed Assets $120 $124

Less Accumulated Depreciation (60) (64)

Net Fixed Assets 60 60

Total Assets $100 $106

Liabilities and Owners Equity

Current Liabilities:

Accounts Payable $ 16 $ 18

Notes Payable 10 10

Total Current Liabilities $ 26 $ 28

Long-term Debt $ 20 $ 18

Total Liabilities $ 46 $ 46

Owners Equity:

Common Stock $ 40 $ 40

Retained Earnings 14 20

Total Liabilities and Owners Equity $100 $106

~ Hokie had Net Income of $26 million for 2013

~ Hokie paid Cash Dividends of $20 million to common stockholders in 2013.

Calculate the following 2013 financial ratios of Hokie Corporation using the information given above:

i. current ratio

ii. acid test ratio

iii. debt ratio

iv. return on total assets

v. return on common equity