hello, have done most of this even figured out all the ratios, but I am not sure how to explain what they mean.

3. Compare the performance of East Coast Yachts to the industry as a whole. For each ratio, comment on why it might be viewed as positive or negative relative to the industry. Suppose you create an inventory ratio calculated as inventory divided by current liabilities. How do you interpret this ratio? How does East Coast Yachts compare to the industry average? Calculate the sustainable growth rate of East Coast Yachts. Calculate external funds needed (EFN) and prepare pro forma income statements and balance sheets assuming growth at precisely this rate. Recalculate the ratios in the previous question. What do you observe?

Sustainable growth rate = 22.9%

EFN = $11,618,729

Pro Forma Ratios

East Coast Yachts	Ratio
Current Ratio	0.85
Quick Ratio	0.49
Total Asset Turnover	1.80
Inventory Turnover	22.42
Receivables Turnover	35.68
Debt Ratio	0.49
Debt-Equity Ratio	0.97
Equity Multiplier	1.97
Interest Coverage	7.97
Profit Margin	7.52%
Return On Assets	13.52%
Return On Equity	26.62%

EAST COAST YACHTS 2015 Income Statement Sales Cost of goods sold Other expenses Depreciation Earnings before interest and taxes (EBIT) Interest Taxable income Taxes (40%) Net income 210,900,000 48.600,000 25.192,000 6.879,000 $30,229,000 3.791,000 $ 26.438,000 0575,200 $15,862,800 Dividends Add to RE $ 4,759.30 $11,103.499 EAST COAST YACHTS Balance Sheet as of December 31, 2015 Assets Liabilities & Equit Current assets Current liabilities Cash Accounts receivable Inventory 3,285,600 Accounts payable ,910,800 Notes payable 6,627.300 $ 6.977,700 14.342.600 $ 21,320.300 Total Total $15,823,700 Fixed assets Long.term debt $ 36.400,000 Net plant and equipment $101.481.200 $5,580,000 54,004.600 59,584.600 117.304.900 Total liabilities and equity $117,304,900 Shareholders' equity Common stock Retained earnings Total equity Total assets Yacht Industry Ratios Upper Quartile 1.89 .62 1.38 16.13 21.45 .61 1.56 2.56 9.83 9.87% 15.83% 28.4% Median Lower Quartile .50 21 68 6.85 6.27 1.43 .38 85 9.15 Current ratio Quick ratio Total asset turnover Inventory turnover Receivables turnover Debt ratio Debt-equity ratio Equity multiplier Interest coverage Profit margin Return on assets Return on equity 11.8 79 1.79 5.18 4.05% 6.05% 993% .52 1.08 2.08 8.06 6.98% 10.53% 16.54% EAST COAST YACHTS 2015 Income Statement Sales Cost of goods sold Other expenses Depreciation Earnings before interest and taxes (EBIT) Interest Taxable income Taxes (40%) Net income 210,900,000 48.600,000 25.192,000 6.879,000 $30,229,000 3.791,000 $ 26.438,000 0575,200 $15,862,800 Dividends Add to RE $ 4,759.30 $11,103.499 EAST COAST YACHTS Balance Sheet as of December 31, 2015 Assets Liabilities & Equit Current assets Current liabilities Cash Accounts receivable Inventory 3,285,600 Accounts payable ,910,800 Notes payable 6,627.300 $ 6.977,700 14.342.600 $ 21,320.300 Total Total $15,823,700 Fixed assets Long.term debt $ 36.400,000 Net plant and equipment $101.481.200 $5,580,000 54,004.600 59,584.600 117.304.900 Total liabilities and equity $117,304,900 Shareholders' equity Common stock Retained earnings Total equity Total assets Yacht Industry Ratios Upper Quartile 1.89 .62 1.38 16.13 21.45 .61 1.56 2.56 9.83 9.87% 15.83% 28.4% Median Lower Quartile .50 21 68 6.85 6.27 1.43 .38 85 9.15 Current ratio Quick ratio Total asset turnover Inventory turnover Receivables turnover Debt ratio Debt-equity ratio Equity multiplier Interest coverage Profit margin Return on assets Return on equity 11.8 79 1.79 5.18 4.05% 6.05% 993% .52 1.08 2.08 8.06 6.98% 10.53% 16.54%