Xara Clothes has the following income statement : Xara Clothes Income Statement 2017 INCOME Sales 31,442.00 Cost of Goods Beginning Inventory value 8,010.00 Manufacturing cost Less Ending Inventory value 19,159.00 8,793.00 Cost of Goods Sold 18,376.00 Gross Profit 13,066.00 Non-Operating Income Interest Income 600.00 Total Non-Operating Income 600.00 Total INCOME 13,666.00 EXPENSES Operating Expenses Accounting and Legal 1,107.00 Advertising 900.00 Depreciation 1,202.00 Insurance 1,041.00 Maintenance and Repairs 923.00 Office Supplies 325.00 Rent 1,268.00 Salaries and Wages 925.00 Telephone & Broadband 118.00 Utilities 565.00 Web Hosting and Domains 165.00 Total Operating Expenses 8,539.00 Non-Recurring Expenses Furniture and Equipment 1,052.00 ASSIGNMENT BRIEFS | SEPTEMBER 2021 18 Total Non-Recurring Expenses 1,052.00 Total EXPENSES 9,591.00 Net Income Before Taxes 4,075.00 Income Tax Expense 815.00 NET INCOME 3,260.00 Xara Clothes Statement of financial position at 31 Dec 2017 ASSETS Current Cash 1,704.00 Inventory of Office Supplies Inventory (Raw Materials, Work In 120.00 Progress, Finished Goods) 8,793.00 10,617.00 Non-current assets Office Equipment 3,785.00 Less: Accumulated depreciation 1,202.00 2,583.00 13,200.00 Equity Owner Capital 6,000.00 Profits/loss 3,260.00 9,260.00 LIABILITIES Current Liabilities Short-term loan NonCurrent Liability 1,940.00 Long-term loans 2,000.00 Total Liabilities + Equity 13,200.00 Instructions Using the ratio categories ie Liquidity ratios, Solvency ratios and Profitability ratios, classify the following ratios: o Current Ratio o Acid-Test Ratio o Debt-Equity Ratio o Profit Margin o Return on Owners' Equity ASSIGNMENT BRIEFS | SEPTEMBER 2021 19 Calculate the following ratios: o Debt-Equity Ratio o Profit Margin o Return on Owners' Equity Based on the information provided and your ratio, how would you describe the financial performances of Xara Clothes?