Comparative financial statements for Track Ltd. are shown below.

Additional information:
1. All sales were on account.
2. The allowance for doubtful accounts was $5,000 in 2017, $4,000 in 2016, and $3,000 in 2015.
3. In each of 2017 and 2016, $15,500 of dividends were paid to the common shareholders.
4. Cash provided by operating activities was $133,500 in 2017 and $180,500 in 2016.
5. Cash used by investing activities was $110,000 in 2017 and $56,000 in 2016.
Instructions
(a) Calculate all possible liquidity, solvency, and profitability ratios for 2017 and 2016.
(b) Identify whether the change in each ratio from 2016 to 2017 calculated in part (a) was favourable (F), unfavourable (U), or no change (NC).
(c) Explain whether overall (1) liquidity, (2) solvency, and (3) profitability improved, deteriorated, or remained the same between 2016 and 2017.
TAKING IT FURTHER
Does this problem use an intracompany comparison or an intercompany comparison? Which do you think is more useful?

TRACK LTD. Income Statement Year Ended December 31 2017 Net sales Cost of goods sold Gross profit Operating expenses Profit from operations Interest expense (net) Profit before income taxes Income tax expense $1,000,000 650,000 350,000 200,000 150,000 35,000 115,000 17,250 $ 97,750 2016 $940,000 635,000 305,000 180,000 125,000 35,000 90,000 13,500 76,500 TRACK LTD Balance Sheet December 31 2017 2016 2015 $ 50,000 42,000 33,000 77,000 150,000 30,000 50,000 75,000 660,000 $1,240,000 $1,135,000 $1,075,000 Accounts receivable Inventories 100,000 240,000 25,000 180,000 75,000 570,000 87,000 200,000 31,000 100,000 75,000 600,000 Long-term debt investments Building and equipment Notes payable Accounts payable Accrued liabilities Bonds payable, due 2020 $125,000 125,000 140,000 50,000 100,000 415,000 160,750 52,000 100,000 437,750 125,000 71,000 20,000 200,000 416,000 Total liabilities Shareholders' equity 200,000 200,000 200,000 Common shares (100,000 issued) 159,000 659,000 Total liabilities and shareholders' equity $1,240,000 $1,135,000 1,075,000 302,250 802,250 220,000 Total shareholders' equity 720,000