Financial statement data of Xi Supplies Inc. as at December 31, 2020, include the following items:

Cash .................................................................................... $ 53,000
Accounts receivable, net ................................................... 127,000
Inventories .......................................................................... 251,000
Prepaid expenses ................................................................ 10,000
Total assets ........................................................................ 922,000
Short-term note payable ................................................... 80,000
Accounts payable ............................................................... 91,000
Accrued liabilities ............................................................... 64,000
Long-term liabilities .......................................................... 248,000
Net income ......................................................................... 147,000
Number of common shares outstanding ....................... 44,000 shares

Required

1. Compute Xi Supplies Inc.’s current ratio, debt ratio, and earnings per share. Round all ratios to two decimal places.

2. Compute each of the three ratios after evaluating the effect of each transaction that follows. Consider each transaction separately.

a. Borrowed $100,000 on a long-term note payable.

b. Issued 12,000 common shares on January 2, 2021, receiving cash of $180,000.

c. Received cash on account, $29,000.

d. Paid short-term note payable, $50,000.

e. Purchased merchandise costing $62,000 on account, debiting Inventory.

f. Paid long-term liabilities, $15,000.

g. Declared, but did not pay, a $40,000 cash dividend on the common shares.

Set up a table in the following format for your answers:

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Transaction Current Ratio Debt Ratio Earnings per Share