Problem $16-17($Static$)$ Interpretation of Financial Ratios $[$LO$16-2,$ LO$16-3,$ LO$16-6]$

Pecunious Products, Incorporated$$s financial results for the past three years are summarized below:

$$Year $3$Year $2$Year $1$Sales trend$128\mathrm{.}0115\mathrm{.}0100\mathrm{.}0$Current ratio$2\mathrm{.}52\mathrm{.}32\mathrm{.}2$Acid$-$test ratio$0\mathrm{.}80\mathrm{.}91\mathrm{.}1$Accounts receivable turnover$9\mathrm{.}410\mathrm{.}612\mathrm{.}5$Inventory turnover$6\mathrm{.}57\mathrm{.}28\mathrm{.}0$Dividend yield$7\mathrm{.}1\%6\mathrm{.}5\%5\mathrm{.}8\%$Dividend payout ratio$40\%50\%60\%$Dividends paid per share$*$$ $1\mathrm{.}50$$ $1\mathrm{.}50$$ $1\mathrm{.}50$

$*$There have been no changes in common stock outstanding over the three$-$year period.

Required:

Review the results above and answer the following questions:

Is it becoming easier for the company to pay its bills as they come due?

Are customers paying their accounts at least as fast now as they were in Year $1?$

Are the accounts receivable increasing, decreasing, or remaining constant?

Is inventory increasing, decreasing, or remaining constant?

Is the market price of the company$$s stock going up or down?

Is the earnings per share increasing or decreasing?

Is the price$-$earning ratio going up or down?