Comparative financial statement data of Panfield Optical Mart follow:

Other information:
1. Market price of Panfield common stock: $94.38 at December 31, 2017; and $85.67 at
December 31, 2016
2. Common shares outstanding: 15,000 during 2017 and 10,000 during 2016
3. All sales on credit
Requirements
1. Compute the following ratios for 2017 and 2016:
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
i. Return on common shareholders' equity
j. Earnings per share of common stock
k. Price/earnings ratio
2. Decide whether
(a) Panfield's financial position improved or deteriorated during 2017, 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 an investment?

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Panfield Optical Mart Comparative Income Statement Years Ended December 31, 2017 and 2016 2 2017 2016 3 Net sales 4 Cost of 5 Gross profit 6 Operating expenses S 686,000 592,000 281,000 311,000 148,000 163,000 50,000 113,000 45,000 68,000 s sold 7 Income from 8 Interest expense 9 Income before income tax 10 Income tax 11 Net income 12 380,000 306,000 127,000 179,000 30,000 149,000 38,000 S 111,000 ations nse Panfield Optical Mart Comparative Balance Sheet As at December 31, 2017 and 2016 2 3 Current assets: 4 2017 2016 2015 Cash Current receivables, net Inventories $ 32,000 82,000 217,000157,000 200,000 297,000 284,000 188,000 7,000 29,000 553,000 552,000 283,000 271,000 aid e Total current assets lant, and equipment, net 10 Total assets 11 Accounts payable 12 Other current liabilities 13 Total current liabilities 14 Long-term liabilities 15 Total liabilities 16 Common shareholders' equity, no par 17 Total liabilities and shareholders' equity 18 $ 836.000 $823.000 701,000 112,000 135,000 187,000 $285,000 292,000 240,000 233,000 525,000525,000 311,000 298,000 199,000 $836,000 823,000 Selected 2015 amounts