Data for Campsey Computer Company and its industry averages follow.

a. Calculate the indicated ratios for Campsey.
b. Construct the DuPont equation for both Campsey and the industry.
c. Outline Campsey’s strengths and weaknesses as revealed by your analysis.
d. Suppose Campsey had doubled its sales as well as its inventories, accounts receivable, and common equity during 2015. How would that information affect the validity of your ratio analysis?

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Campsey Computer Company: Balance Sheet as of December 31, 2015 Cash Receivables Inventories Total current assets Net fixed assets $77,500 Accounts payable 336,000 241,500 Other current liabilities 655,000 Total current liabilities 292,500 Long-term debt $129,000 84,000 117,000 S330,000 256,500 361,000 947,500 Tta iabilities and eqty $947,500 Notes payable Common equity Total assets Campsey Computer Company. Income Statement for Year Ended December 31, 2015 Sales Cost of goods sold 1,607,500 1,353,000) Gross profit $254,500 143,000) $111,500 Fixed operating expenses except depreciation Earnings before interest, taxes, depreciation and amortization (EBITDA) Earnings before interest and taxes (EBIT) Earnings before taxes (EBT) 41,500) $ 70,000 24,500) S 45,500 18,200 S 27,300 Depreciation Interest Taxes (40%) Net income Industry Average 2.0x Ratio Campsey Current ratio Days sales outstanding Inventory turnover Total assets turnover Net profit margin Return on assets (ROA) Return on equity (ROE) Debt ratio 35.0 days 5.6x 3.0x 1.2% 9.0% 60.6%