Williams Company is a manufacturer of auto parts having the following financial statements for 2015-2016.

Additional financial information, including industry averages for 2016, where appropriate.

Required
Calculate and interpret the financial ratios for Williams for both years. Since the calculation of many ratios requires the average balance in an account (e.g., average receivables is required in calculating receivables turnover) you may assume that the balances in these accounts in 2015 are the same as 2014.

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Balance Sheet December 31, 2016 and 2015 2016 2015 Cash Accounts receivable Inventorv Total current assets Long-lived assets Total assets Current liabilities Long-term debt Shareholder Equity Total debt and equity S 260,000 S 135.000 150,000 225,000 385,000 175.000 795,000 535,000 1.640,000 1500,000 S 2.435.000 S 2.035.000 200,000 175.000 900,000 800,000 1.335.000 1.060,000 S 2.435.000 S 2.035.000 Income Statement For year ended December 31,2016 and 2015 Sales Cost of sales Gross mar Operating expenses Operating income 2016 S3,500,000 2.500,000 1,000,000 500,000 500,000 175.000 S325,000 2015 S3,600,000 2.600,000 1,000,000 450,000 550,000 192.500 $357,500 gin laxeS Net income Cash Flow from Operations 2015 $325,000 357.500 Net income Plus depreciation expense +DecreaseGinc) in Accounts receivable and Inventory +Increase -dec) in Current Liabilities Cash flow from operations 60,000 (135,000) 25.000 275,000 407,500 2016 $200,000 35% S60,000 50,000 $2.25 1,800,000 2015 Industrv 2016 Capital Expenditures Income tax rate Depreciation expense Dividends Year-end stock price Number of outstanding shares Sales multiplier Free cash flow multiplier Eamings multiplier Cost of capital Accounts receivable turmover Inventorv turmover Current ratio Quick ratio Cash flow from operations ratio Free cash flow ratio Gross margin percentage Returm on assets (net book value) Return on equity $100,000 35% $50,000 50,000 $2.75 1,800,000 35.0% $25.00 1.50 18.00 9.00 5.00% 5.00% 11.10 10.50 2.30 1.90 1.20 1.10 30.0% 20.0% 30.0%