The following information comes from the accounting records of Tableak Ltd.:

Required

a. Based on above information, analyze and comment on the changes in the company’s profitability and liquidity, in addition to the management of accounts receivable and inventory from 2018 to 2020.

b. Based on the above information, analyze and comment on the company’s use of leverage from 2018 to 2020.

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2020 2018 2019 Statement of Financial Position Assets $ 33,750 $ 30,000 Cash 37,500 Accounts receivable 101,250 120,000 167,500 Inventory 165,000 195,000 190,000 Capital assets (net) 645,000 675,000 750,000 Other assets 348,000 315,000 399,600 $1,335,000 $1,293,000 $1,544,600 Liabilities and shareholders' equity $ 190,000 $ 150,000 $ 170,000 Accounts payable Long-term debt 300,000 325,000 520,000 787,500 787,500 Common shares 787,500 Retained earnings 55,500 52,500 47,100 $1,293,000 $1,335,000 $1,544,600 Statement of Income $1,200,000 $1,350,000 Sales $1,050,000 Cost of goods sold 761,250 852,000 945,000 Other expenses 255,000 276,000 327,000 33,750 72,000 78,000 Income tax 14,700 18,000 23,400 $ 54,600 Net income 19,050 54,000