1. When God blesses us financially, what does He expect us to do with the abundance?
2. Why might the revenue and cost figures shown on a standard income statement not be representative of the actual cash inflows and outflows that occurred during a period?

1. Discuss some of the uses and limitations associated with performing ratio analysis.
   • Problem:
2. Fill in King, Inc. financial ratios. Comment on strengths and weaknesses.

Forecasted Balance Sheet as of December 31, 2020
Cash	$ 72,000
Accounts receivables	$ 639,000		Accounts and notes payable	$ 432,000
Inventories	$ 994,000		Accruals	$ 170,000
Total current assets	$1,705,000		Total current liabilities	$ 602,000
Land and building	$ 338,000		Long-term debt	$ 604,290
Machinery	$ 132,000		Common stock	$ 775,000
Other fixed assets	$ 61,000		Retained earnings	$ 254,710
Total assets	$2,236,000		Total liabilities and equity	$2,236,000
Forecasted Income Statement for 2020
Sales	$6,390,000
Cost of goods sold	$5,580,000		Per-Share Data
Gross operating profit	$ 810,000		EPS	$
General admin & selling expenses	$ 236,320		DPS	$
Depreciation	$ 159,000		P/E Ratio
Misc. Expenses	$ 34,000		Market price	$ 50.00
Earnings before Taxes	$ 380,680		Number of shares outstanding	20,000
Taxes	$ 126,306
Net Income	$ 254,374
	King, Inc.	Financial Ratios
	Quick Ratio
	Current Ratio
	Inventory Turnover
	Days Sales Outstanding
	Fixed Asset Turnover
	Total Asset Turnover
	Return on Assets
	Return on Equity
	Debt/Equity Ratio
	Profit Margin on Sales
	P/E Ratio