b. Calculate and interpret the following ratios: Sector Average Return on assets 5.2% Current ratio 2.0 DCOH 22 days 19 days 71% Average collection period Debt ratio Debt-to-equity ratio Times interest earned ratio 2.5 2.6 Fixed-asset turnover ratio 1.4 Tal condi Green Valley Nursing Home Inc. Balance Sheet, December 31, 2016 ASSETS Current assets Cash $ 105,737 Short-term securities Net accounts receivable 200,000 215,600 Supplies 87,655 $ 608,992 2,250,000 356,000 $1,894,000 $2,502,992 Total current assets Property and equipment Less: Accumulated depreciation Net property and equipment Total assets LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable $ 72,250 Accrued expenses 192,900 Notes payable 100,000 Current portion of long-term debt 80,000 Total current liabilities $ 445,150 Long-term debt $1,700,000 Shareholders' equity Common stock, $10 par value $ 100,000 Retained earnings 257,842 Total shareholders' equity $ 357,842 Total liabilities and shareholders' equity $2,502,992 13.5 Consider the following financial statements for Green Valley Nursing Home Inc., a for-profit, long-term care facility. Green Valley Nursing Home Inc. Statement of Income and Retained Earnings, Year Ended December 31, 2016 Revenue Resident services revenue $3,163,258 Provision for bad debts 110,000 Net resident services revenue Other revenue 3,053,258 106,146 $3,159,404 Total revenues Expenses Salaries and benefits Medical supplies and drugs Insurance and other Depreciation Interest Total expenses Operating income Income tax expense Net income Retained earnings, beginning of year Retained earnings, end of year $1,515,438 966,781 296,357 85,000 206,780 $3,070,356 $ 89,048 31,167 $ 57,881 $ 199,961 $ 257,842