lle profits earned. Suation and Test Your Knowledge Why are ratios used to analyze the financial statements of organizations? When common size ratios are prepared, each asset is compared to and each expense is compared to 1. 2. . How do common size 3. How do you evaluate a ratio for a spe- 4. Why might too much liquidity be a prob- ratios help compare organizations? cific year? lem for an organization? Why might too little be a problem? 5. Discuss when and why different profit- ability ratios might be used. 6. Using Tables 14-1 and 14-2 from the text, calculate the current ratio, days cash on hand, days in accounts receiv- able, total asset turnover, interest cover- age, long-term debt to net assets, total margin, and return on assets for 2019. Show your work