) Ratio calculation Ratio Formula Current ratio Current assets / Current liabilities Quick ratio Current assets - Inventories / Current liabilities Times interest earned EBIT/Interest expense Accounts receivable turnover Net Annual Credit Sales Average Accounts Receivables Average collection period Accounts Receivables/Net Annual Credit Sales *365 Asset turnover Net sales / Average total assets Gross profit margin Gross profit / Net sales Net profit margin Net profit / Net sales Total debt ratio Total liabilities / Total assets Return on assets Net income / Total assets Return on equity Net income / Shareholder's equity Ratio 2021 2020 Current ratio 0.608 0.792 Quick ratio 0.554 0.723 Times interest earned 3.862 3.219 Accounts receivable turnover 6.700 6.514 Average collection period 57.90 56.03 Asset turnover 0.351 0.355 Gross profit margin 60.21% 59.14% Net profit margin 9.84% 8.15% Total debt ratio 0.665 0.710 Return on assets 3.54% 2.91% Return on equity 11.23% 10.47% is this correct