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 Comparative Balance Sheet This Year Last Year Current assets: $ 1,050,000 Cash Marketable securities Accounts receivable, net Inventory Prepaid expenses 3,060,000 3,400,000 240,000 1,360,000 300,000 2,160,000 2,400,000 220,000 Total current assets Plant and equipment, net Total assets Liabilities and Stockholders' Equity 9,140,000 $17,450,000 $15,580,000 9,700,000 Liabilities: Current liabilities $ 4,400,000 3,160,000 3,120,000 6,280,000 3,720,000 8,120,000 Note payable, 108 Total liabilities Stockholders' equity: Common stock, $70 par value Retained earnings 7,000,000 2,300,000 9,300,000 $17,450,000 $15,580,000 7,000,000 2,330,000 9,330,000 Total stockholders' equity Total liabilities and stockholders' equity an Comparative Income Statement and Reconciliation ear Last Year Sales (all on account) Cost of goods sold Gross margin Selling and administrative expenses Net operating income Interest expense Net income before taxes Income taxes (308) $15,950,000 14,480,000 10,860,000 3,620,000 1.640.000 1,980,000 312,000 1,668,000 500,400 1,167,600 583, 800 583,800 1,716,200 $ 2,330,000 2,300,000 12,760,000 3,190,000 2,018,000 1,172,000 372,000 800,000 240,000 560,000 530,000 30,000 2,300,000 1ncome Common dividends Net income retained Beginning retained earnings Ending retained earnings To begin your assignment you gather the following financial data and ratios that are typical of companies in Lydex Company's industry: Current ratio Acid-test ratio Average collection period Average sale period Return on assets Debt-to-equity ratio Times interest earned ratio Price-earnings ratio 60 days Required: 1. Present the balance sheet in common-size format. 2. Present the income statement in common-size format down through net income