Nature Frames has asked you to determine whether the company's ability to pay current liabilities and total liabilities improved or deteriorated during 2012. To answer that question, compute these ratios for 2012 and 2011, using the following data:

a. Current ratio
b. Acid-test ratio
c. Debt ratio
d. Times-interest-earned ratio

2012 2011 Cash Short-term receivables Net receivables Inventory Total assets Total current liabilities Long-term note payable Income from operations Interest expense 62,500 49,000 $ 29,000 $128,460 $128,160 $245,340 $261,620 $565,000 $282,000 $206,000 $ 45,700 71,760 $158,700 $161,190 $46,000 40,500 $496,000