The 2020 financial statements of Outdoor Waterworks Inc. follow:

Assume all sales were on credit. Also assume the long-term note payable is due in 2023, with no current portion. On the December 31, 2019, balance sheet, the assets totalled $432,720, common shares were $192,000, and retained earnings were $107,640.

Required

Calculate the following:?

(a) Current ratio,?

(b) Quick ratio,?

(c) Days? sales uncollected,?

(d) Inventory turnover,?

(e) Days? sales in inventory,?

(f) Ratio of pledged plant assets to secured liabilities,?

(g) Times interest earned,?

(h) Profit margin,?

(i) Total asset turnover,?

(j) Return on total assets, and?

(k) Return on common shareholders? equity.

Analysis Component: Identify whether the ratios calculated above compare favourably or unfavourably to the industry averages in Exhibit 17.11.

Exhibit 17.11

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Outdoor Waterworks Inc. Outdoor Waterworks Inc. Income Statement Balance Sheet December 31, 2020 For Year Ended December 31, 2020 Net sales. $966,000 Assets Cash. $ 22,200 Cost of goods sold: $ 75,360 600,840 $676,200 Inventory, Dec. 31, 2019. 24,480 Current non-strategic investments. Purchases. 52,080 Accounts receivable, net. Goods available for sale. Notes receivable . 10,560 Inventory, Dec. 31, 2020 59,040 59,040 5,760 Inventory. Cost of goods sold. 617,160 $348,840 Prepaid expenses Gross profit from sales. Plant and equipment, net. 326,520 Operating expenses. 273,360 $500,640 Total assets. $ 75,480 Operating profit. Liabilities and Equity Accounts payable. Accrued wages payable. Income taxes payable. Interest expense. 11,400 $ 48,840 $ 64,080 Profit before taxes. 6,240 Income taxes. 18,864 6,960 $ 45,216 Profit. Long-term note payable, secured by mortgage on plant. 114,000 Common shares, 160,000 shares. Retained earnings. Total liabilities and equity. 192,000 132,600 $500,640 1.6:1 1.1:1 16 times 21 days 5 times Times interest earned. Profit margin. Gross profit ratio. Return on total assets Return on common shareholders' equity. Book value per common share. Book value per preferred share. Earnings per share. Price-earnings per share. Dividend yield . 50 times 14% 18% Current ratio Quick ratio... Accounts receivable turnover Days' sales uncollected. Inventory turnover. Days' sales in inventory. Total asset turnover. Accounts payable turnover Debt ratio Equity ratio Pledged assets to secured liabilities 20% 32.7% $8.63 70 days 2.3 times 4 times 35% 65% 1.4:1 $15.00 $1.79 18.2 $0.35