Task 2c: CLO1 OBJECTIVE: To enable learners to utilise financial ratios as a mechanism to evaluate firm's financial performance and identify areas for making decisions for improvement. REQUIREMENT: Financial Statement Analysis Question The condensed financial statements of the Lavender Companies, Inc. for the years ended June 30, 2021 and 2020 are presented as follow. Lavender Companies, Inc Balance Sheets June 30 (in millions) 2021 2020 Assets Current assets Cash and cash equivalents $546.9 $346.7 Account Receivables (net) 624.8 580.6 Inventories 544.5 630.3 Prepaid expenses and other current assets 211.4 181 3 Total current assets 1,927.6 1,738.9 Property, plant and equipment (net) 580.7 528 7 Investments 30.3 410 Intangibles and other assets 877.9 910.2 Total assets $3.416.5 $3 218.8 Liabilities and Stockholders' Equity Current liabilities $959.6 $856.7 Long-term liabilities 635.0 650.0 Stockholders' equity - common 1,821 9 1,712.1 Total liabilities and stockholders' equity $3,416 5 $3,218.8 Lavender Companies, Inc Income Statements For the year ended June 30 (in millions) 2021 2020 Revenues 54.751.5 $4.682 1 Cost and expenses Cost of goods sold 1,273.4 1 226.4 Selling and administrative expenses 3,133.6 2,947.6 Interest expense 17.6 26.7 Total costs and expenses 4,424.5 4.200.7 Pretax income 326.9 481 4 Income taxes 114.4 174.0 Net income $212 5 $307 4 Required: Analyse Lavender's financial statements, Include computation of the following ratios for 2020 and 2021 and comparisons of these ratios in your discussion. a. Current ratio b. Inventory turnover (Inventory on June 30 2019 was $546.3) c. Return on assets (Assets on June 30 2019 were $3,043.3) d. Return on common stockholders' equity e. Debt to total asset ratio