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: Lydes Company Comparative lance Sheet This Year Last Year Assets Current assets: Cash Marketable securities Accounts receivable, net Inventory Prepaid expen Total current assets Plant and equipment, t Total assets Liabilities and Stockholders' Equity Current Italien Note payable, 10 Total Stabilition Stockholders ty Common stack, $75 par value $ 1,020,000 $1,300,000 3,910,000 3,660,000 270,000 7,192,202 9,12,200 $17,530,000 100,000 1,010,000 2,100,000 310,000 5,910,000 9,110,000 $15,820,000 $ 1,078,000 3,700,000 $ 1,100,000 3,100,000 ,300,000 7,720,000 7,500,000 7,500,000 2,300,000 1,120,000 9,760,000 1,120,000 Total liabilities and stockholders equity $ 17,530,00 $15,000,000 Retained earnings Total stockholders' equity Lydex Company Comparative Income Statement and Reconciliation Sales (all on account) Cost of goods sold This war $ 15,930,000 12,730,000 $14,108,000 10,635,000 3,545,000 3,181,000 1,014,000 3,628,000 Cross margin Selling and administrative exp Net operating income Net Sicone before taxes Net inco Common dividends Net income retained Sening retained earnings Inding retained earnings 1,000,000 2,170,000 370,000 1,917,000 313,200 1,607,200 402,100 1,260,000 1,124,900 940,000 1,330,000 563,450 757,550 2,200,000 $ 1,320,000 To begin your assignment you gather the following financial data and ratios that are typical of companies in Lydex Company's Industry: Current ratia Acid-text ratio Average collection period Average sale period Return on ass Cebt-to-equity ratio Times interest earned ratin Price-earnings ratio 2.3 1.1 12 days 6 days 9.9% 10 Required: 1. You decide first to assess the company's performance in terms of debt management and profitability. Compute the following for both this year and last year: (Round your "Percentage" answers to 1 decimal place and other answers to 2 decimal places.) s. The times Interest earned ratio. b. The debt-to-equity ratio. c. The gross margin percentage. d. The return on total assets. (Total assets at the beginning of last year were $13.130,000) e. The return on equity (Stockholders equity at the beginning of last year totaled $8,257,550. There has been no change in common stock over the last two years.) fis the company's financial leverage positive or negative?