Need help with part b

V (b) The following are three independent situations and a ratio that may be affected. For each situation, compute the affected ratio (1) as of December 31, 2017, and (2) as of December 31, 2018, after giving effect to the situation. (Round all answers to 1 decimal places, e.g. 1.8 or 1.8%. If % change is a decrease show the numbers as negative, e.g. 4.83% or (1.83%).) Situation Ratio 1. 20,000 shares of common stock were sold at par on July 1, 2018. Net income for 2018 was $55,000. Return on common stockholders' equity 2. All of the notes payable were paid in 2018. All other liabilities remained at the same levels as at December 31, 2018. At December Debt to assets ratio 31, 2018, total assets were $895,000. 3. The market price of common stock was $9 and $12 on December 31, 2017 and 2018, respectively. Net income for 2018 was $55,000. Price-earnings ratio 2018 2017 % Change Return on common stockholders' equity \"/0 % \"/0 Debt to assets ratio % % % Price earnings ratio times times % Question 3 The following financial information is for Pharoah Company. PHAROAH COMPANY Balance Sheets December 31 Assets 2017 2016 Cash $ 72,000 $ 69,000 Debt investments (short-term) 54,000 39,000 Accounts receivable 107,000 90,000 Inventory 236,000 162,000 Prepaid expenses 30,000 27,000 Land 133,000 133,000 Building and equipment (net) 260,000 188,000 Total assets $892,000 $708,000 Liabilities and Stockholders' Equity Notes payable $170,000 $106,000 Accounts payable 65,000 54,000 Accrued liabilities 42,000 42,000 Bonds payable, due 2020 250,000 171,000 Common stock, $10 par 209,000 209,000 Retained earnings 156,000 126,000 Total liabilities and stockholders' equity $892,000 $708,000PHAROAH COMPANY Income Statements For the Years Ended December 31 2017 2016 Sales revenue $898,000 $789,000 Cost of goods sold 647,000 575,000 Gross profit 251,000 214,000 Operating expenses 194,000 160,000 Net income $ 57,000 $ 54,000 Additional information: Inventory at the beginning of 2016 was $115,000. Accounts receivable (net) at the beginning of 2016 were $89,000. Total assets at the beginning of 2016 were $633,000. No common stock transactions occurred during 2016 or 2017. WPPPE' All sales were on account