Carson Electronics' management has long viewed BGT Electronics as an industry leader and uses this firm as a model firm for analyzing its own performance. The balance sheets and income statements for the two firms are found here:

a.Calculate the following ratios for both Carson and BGT:

Current ratio Times interest earned Inventory turnover Total asset turnover Operating profit margin

Operating return on assets Debt ratio Average collection period Fixed asset turnover Return on equity

b.Analyze the differences you observe between the two firms. Comment on what you view as weaknesses in the performance of Carson as compared to BGT that Carson's management might focus on to improve its operations.

Carson Electronics, Inc. Income Statement ($000) Net sales (all credit) $48,040 Cost of goods sold (35,970) Gross profit $12,070 Operating expenses (7,950) Net operating income $4,120 Interest expense (1,160) Earnings before taxes $2,960 Income taxes (40%) (1,184) Net income $1,776 ick on the icon in order to copy its contents into a spreadsheet.) BGT Electronics, Inc. Income Statement ($000) $70,000 (42,030) $27,970 (11,980) $15,990 (600) $15,390 (6,156) $9,234 Cash Accounts receivable Inventories Current assets Net fixed assets Total assets Carson Electronics, Inc. Balance Sheet ($000) $2,030 4,490 1,480 $8,000 15,970 $23,970 BGT Electronics, Inc. Balance Sheet($000) $1,460 5,990 2,450 $9,900 24,950 $34,850 Accounts payable $2,490 Accrued expenses 1,020 Short-term notes payable 3,500 Current liabilities $7,010 Long-term debt 8,040 Owners' equity 8,920 Total liabilities and owners' equity $23,970 (Click on the icon in order to copy its contents into a spreadsheet.) $5,020 1,540 1,490 $8,050 4,000 22,800 $34,850