Comparative financial statement data of Panfield Optical Mart follow:

Other information:
1. Market price of Panfield common stock: $94.38 at December 31, 2012, and $85.67 at December 31, 2011
2. Common shares outstanding: 15,000 during 2012 and 10,000 during 2011
3. All sales on credit

Requirements
1. Compute the following ratios for 2012 and 2011:
a. Current ratio
b. Quick (acid-test) ratio
c. Receivables turnover and days€™ sales outstanding (DSO) (round to nearest whole day)
d. Inventory turnover and days€™ inventory outstanding (DIO) (round to nearest whole day)
e. Accounts payable turnover and days€™ payable outstanding (DPO) (round to nearest whole day).
f. Cash conversion cycle (in days)
g. Times-interest-earned ratio
h. Return on assets (use DuPont analysis)
i. Return on common stockholders€™ equity (use DuPont analysis)
j. Earnings per share of common stock
k. Price/earnings ratio
2. Decide whether (a) Panfield€™s financial position improved or deteriorated during 2012 and (b) the investment attractiveness of Panfield€™s common stock appears to have increased or decreased.
3. How will what you learned in this problem help you evaluate aninvestment?

Panfield Optical Mart Comparative Income Statements Years Ended December 31, 2012 and 2011 2012 2011 Net sales Cost of goods sold Gross profit Operating expenses Income from operations Interest expense Income before income tax Income tax expense Net income $686,000 S592,000 380,000 281,000 306,000 311,000 127,000148,000 179,000163,000 50,000 149,000 113,000 45,000 $111,000 68,000 38,000